Wednesday, August 19, 2020

RE: [MFP] Businesses Behaving Badly: The Troubling Parallels Between Microfinance and Facebook

 

You know this used to be a useful group, but now it has turned into a whining session for frustrated socialists. Profits are evil. Ownership is dangerous. Means of production should be in the hands of those who don't know what to do with them. Feel like I am reading about 1920 not 2020. So unlike all of you complainers, I'm not going to complain. Just leave. Bye all.

 

From: MicrofinancePractice@yahoogroups.com <MicrofinancePractice@yahoogroups.com>
Sent: Tuesday, August 18, 2020 11:57 PM
To: MicrofinancePractice@yahoogroups.com; microfinancepractice@yahoogroups.com
Subject: Re: [MFP] Businesses Behaving Badly: The Troubling Parallels Between Microfinance and Facebook

 

 

Chuck,

 

Thanks for the piece you wrote for Bottom Billion. You and I were there from the start of microfinance  and it is distressing to see how such a wonderful idea became corrupted by greed. After two decades in the microfinance (more accurately the micro credit) trenches)I jumped ship once I found savings groups in Nepal and later India and Zimbabwe. Savings groups showed that it was possible to jettison the MFI infrastructure and train groups to save and lend. Today there are around a million groups plus millions of self-help groups in India. 

 

My recent trip to Nepal (2018) showed me that microfinance was still relevant. It  was possible to serve the poor (but not the poorest) using a quasi Grameen model while charging 18% per year on a declining basis. The one credit union I looked at was able to achieve all this while generating sufficient profits to push into more distant regions and providing training.  With that said most of the easily accessible villages had ten or MFIs looking for customers and then there was the issue 1% interest the issues of an over saturated market and too much debt are the same as is true with microfinance around the world

 

During this same study in Nepal I interviewed a Dalit (untouchable caste) woman. She organized other Dalit women in her village into a dhikuti (ROSCA). No outside training or support and the amount they saved was substantial. It occurred that with a tiny bit of support (perhaps $30 per month, this woman could organize similar dhikutis in nearby villages. Hundreds of such women networked virtually and through face to face meetings could bring basic financial services to the very poorest women in Nepal. We call them "community geniuses" with a nod to the MacArthur Foundation's geniuses awards. A pilot project starting with 100 of these women would cost only $50,000 and reach 10,000 women at a cost of $5 each.  

 

It's tune to try something new,

 

Thanks Chuck,

 

Jeff

-----Original Message-----
From: Chuck Waterfield chuck.waterfield@gmail.com [MicrofinancePractice] <MicrofinancePractice@yahoogroups.com>
To: MFP <microfinancepractice@yahoogroups.com>
Sent: Tue, Aug 18, 2020 4:02 am
Subject: [MFP] Businesses Behaving Badly: The Troubling Parallels Between Microfinance and Facebook

 

Six weeks ago, I posted some thoughts on MFP about how microfinance and Facebook both became vehicles for activity that violated their original intents. Nextbillion has now posted an edited version of my post. Here is their intro paragraph and a link to the article:

 

Chuck Waterfield left microfinance five years ago, after working in the sector for three decades. He stopped using Facebook three years ago, after using the platform for about 10 years. As he explains, the troubling parallels between the two drove his decision to leave both. He explores how their business models have grown increasingly problematic over time – and why, without external intervention, things are likely to get worse.

 

 

Regards,

 

Chuck Waterfield

 

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