Microfinance Practice: Re: [MFP] Re: Microcredit disaster in South Africa

Milford ... thank you for drawing attention to your article in the Guardian about the impact of microfinance in South Africa.

I am appalled at the superficial analysis about microcredit that has been going on for years, but nobody has seem fit to pay much attention to what I have had to say. From my perspective microcredit is a wonderful way to mitigate to some modest extent the terrible impact of poverty, but microcredit (microfinance, microinsurance, financial inclusion and all the rest) are merely initiatives that make poverty a little lest difficult.

Meaningful development means making investment in initiatives that will improve the productivity of the economy in a significant way. This is what capital markets and institutions like the World Bank should have accomplished, but they have disbursed mightily and achieve relatively little. The dysfunction of the modern global economic system is deep, but ignored by most everyone.

I was a very effective management accountant (and eventually CFO) many years ago because I was good at the analysis of operations and understood what delivered results. We can do this for society as well as we can do this for the corporate organization, but it needs radical reform of the metrics being used. This is what I am doing with TrueValueMetrics and Multi Dimension Impact Accounting (MDIA). When we change the way we score the game, we will change the way we play the game.

Peter Burgess - TrueValueMetrics

Multi Dimension Impact Accounting

http://www.truevaluemetrics.org/DBadmin/DBtxt001.php?vv1=txt20080001

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Peter Burgess
TrueValueMetrics ... Meaningful Metrics for a Smart Society

Multi Dimension Impact Accounting

http://www.truevaluemetrics.org/DBadmin/DBtxt001.php?vv1=txt20080001
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On Tue, Nov 19, 2013 at 4:08 PM, milford bateman <milfordbateman@yahoo.com> wrote:

Some of you might be interested in my invited piece for The Guardian looking at the disaster in South Africa that is microcredit and the cautionary tale of blindly pursuing 'financial inclusion'. The bulk of the current damage is NOT being inflicted by payday lenders, as some analysts mistakenly continue to suggest (though Wonga and others are operating in SA and making things worse), but by the mainstream banks that jumped into unsecured lending with the fullest possible support of the international donor community because their move was promoting the all-important mantra of 'financial inclusion'.

http://www.theguardian.com/global-development-professionals-network/2013/nov/19/microcredit-south-africa-loans-disaster

Milford Bateman