Crossfire: Microfinance can serve the very poor, but does it?

Abstract

Microfinance was started as a tool to address extreme poverty, or even ‘to put poverty in a museum’. There is continuing debate about whether it can or cannot do this. Some argue that microfinance can and does alleviate or even ‘cure’ poverty, others that it has little or no impact, or even that it may even exacerbates poverty, particularly for the very poorest people. Two well-informed protagonists from South Asia discuss this issue. Rabeya Yasmin worked for Bangladesh Rehabilitation Assistance Committee (BRAC) in Bangladesh for 19 years, and was director of the well-known BRAC targeting the ultra poor (TUP) programme. She was educated at the University of Dhaka and at the IDS in Sussex, and is a member of the boards of several institutions in Bangladesh. Frances Sinha is a Director and co-founder of M-Cril, the international financial services and social business rating and research agency, based in Delhi. She is originally from the United Kingdom but has lived and worked for over thirty years in India, but also throughout South Asia and Africa.