---------- Forwarded message ----------
From: Yael Schwartzman <yaelsf@gmail.com>
Date: Thu, Sep 30, 2010 at 09:41
Subject: Re: [change] Commercial Microcredit = Just Profit or Unjust Profiteering?
To: Colin Dixon <ckd@cs.washington.edu>
Cc: Yaw Anokwa <yanokwa@gmail.com>, Change Group <change@change.washington.edu>

I've been talking to a few microfinance institutions here in Mexico, where this debate has been going on for a while.

Here in Mexico we have talked to Compartamos, that had a very successful IPO and has around 1 million clients and no longer needs non-profit seeking funding.

We have also talked to a few other MFIs who still need external funding. Their main problem is that they need proof of social
impact to continue getting money from this non-profit seeking investors. However, how are they going to get that data if there's very
little record-keeping going on in their client's businesses?

Tools like ODK are a great way to help! We're also trying to help through our software ;)

I can't decide which way is better.. there's certainly a lot of benefit of having money when you want it without having to collect data or proof anything beyond profitability. However, this always comes at the expense of higher interest rates for the MFI clients so...

-Yael

On Thu, Sep 30, 2010 at 11:16 AM, Colin Dixon <ckd@cs.washington.edu> wrote:

Having just listened to the podcast, it sounded like a big part of making the bank model work was the cost of banking computers and software.

Is this a big chance to do an OpenMRS/ODK-style thing for banking?

--Colin
-- Sent from my Palm Pre

On Sep 30, 2010 8:50 AM, Yaw Anokwa <yanokwa@gmail.com> wrote:

Say you want to make loans to millions of poor women in the developing
world, to help them climb out of poverty. Is it OK to raise money from
rich investors, who expect to make a profit?

Muhammad Yunus, the father of microfinance, says no. If you have
investors who expect profits, you'll ultimately turn into something
more like a loan-shark than a do-gooder.

Vikram Akula, founder of SKS Microfinance — a company that had an IPO
earlier this year — says raising money from profit-seeking investors
is the only way to spread microfinance quickly around the world.

NPR's Planet Money did a great podcast on the different viewpoints at
http://is.gd/fCo5h. You can also watch the video of Clinton Global
Initiative debate at http://is.gd/fCnWl.

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