Konrad
Thanks for this. You are so very right in saying that it is vitally important to assess and condemn how much tribute is being passed up from Cambodia's poor to the wealthy managers and equity holders of the main MFIs. Judging by the way that wealthy hedge funds and investment houses were jostling for position to take an equity stake in the hugely profitable ACLEDA Bank – Cambodia's largest microcredit bank (in fact, Cambodia's largest bank overall) – the chance to make some serious money for shareholders by engaging with Cambodia's poor has been very widely recognized, and it is clearly the primary motive behind the rapid expansion of Cambodia's microfinance sector. Many working in Cambodia are even proud of the fact that they are making out like bandits at the expense of the poor. The newly appointed Chairman and long-time Vice-Chairman at ACLEDA, and former merchant banker, John Brinsden, remarked in an interview in 2014 as follows:
"One day, my former Standard Chartered Bank chairman said to me: "How are the mighty fallen!" when he heard I was working for a micro-finance organization (ACLEDA). I replied: 'When you get 24 per cent return on investment, you can come and see me and I might give you a job," Brinsden chuckles.
Of course, some of the Cambodian MFIs are fighting back against the charges that they are profiteering at the expense of Cambodia's poor, though often in rather silly ways. For instance, I'm not sure what he was trying to achieve, but one senior manager at AMK, a Mr Marcus Fedder, was so angry at a previous article I did on Cambodia that he decided to post on Amazon the very next day a short but nasty 'review' of my 2010 book:
At any rate, as the old NGOs are converted over to commercial respectability or go under, this profiteering at the expense of the poor has become the stake that is being driven into the heart of the microfinance industry in Cambodia and everywhere else, and also that of its equally cynical anti-developmental successor, the global financial inclusion industry.
I find the best account of what's going on to be a just-out book by Dr Phil Mader who is a Research Fellow at the Institute of Development Studies (IDS) in Sussex in the UK, entitled "The Political Economy of Microfinance: Financializing Poverty". Based on his award-winning PhD thesis (disclosure – I was on his advisory board) he has produced a remarkably direct and damning critique of the exploitative 'acumen;action by dispossession' tendencies inherent to market-driven commercialised microfinance.
Milford
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Posted by: milford bateman <milfordbateman@yahoo.com>
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