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CHAPTER 7: The Men from Kabul and the Eunuchs of India: The (Not So) Simple
CHAPTER 7: The Men from Kabul and the Eunuchs of India: The (Not So) Simple
LENDING TO THE POOR
People hwo involved
People who land
Lenders
Fprmal lenders
Cooperative
Informal lenders
Money lenders, shop keeper
Credit Price
Informal source: more expensive
Formal source: less expensives
History
1960-1980 Govermene sponsored credit program
Failure
Subsidized lending: politans take advantages
Success
Place with bank has declining poverty
MICRO INSIGHT FOR MACRO PROGRAM
Deviation. Traditional money leading removing flexibility
Effect
Lending the poor becomes so very expensive
Transaction
Manage to make money at intens rate of around 25% per year, local money leader change two to four times as much.
Mission
Social
Profit
Commercial
Administration free
Function
Money lending reinveted for social purpose
THE LIMIT OF MICRO CREDIT
Micro credit is not popular
Relatively expensive
HOW CAN LARGER FIRMS BE FINANCE?
Micro credit is designed for poor people, also not designed for larger borrower