The Huffington Post, a US-based news website, recently published an editorial series by Jonathan Lewis, founder of the annual Opportunity Collaboration retreat for social investors, titled “Social Impact Evaluation: Useful? Utopian?”, which responds to suggestions by members of academia and the media that “microcredit does not solve poverty.” Mr Lewis claims that microfinance is “a poverty reducer rooted in the non-academic, marketplace realities of the poor” and has “billions of social investment dollars at work” with enrollment of 190 million microborrowers and a reported repayment rate of 97 percent. As an advocate of microfinance, he expresses concern that negative publicity media may lead to donor skepticism and discontinued support for the service.
“Microfinance is being unreasonably measured and criticized for what it is not,” says Mr Lewis, “(a) Microloans are not savings accounts. (b) Micro-lending to the poor with an entrepreneurial bent is not reaching the poor without [such an inclination]. (c) Individual economic empowerment in remote villages is not macroeconomic development.” Referring to detractors of microfinance, the author writes, “The mundane verdict that public relations departments [wrongly] proselytize microfinance’s impact may sell books, but it also feeds a cynicism about one of the few viable poverty alleviation techniques that has emerged from a developing country.”
By Carol Kim, Research Associate
Sources and Additional Resources:
Huffingtonpost.com: “Social Impact Evaluation: Useful? Utopian? (Part 2 of 4)”, http://www.huffingtonpost.com/jonathan-lewis/social-impact-evaluation-_1_b_885761.html
MicroCapital.org: “MICROCAPITAL BRIEF: Microfinance Experts Say “Microcredit Is Not The Enemy””, December 21, 2010, https://www.microcapital.org/microcapital-brief-microfinance-experts-say-microcredit-is-not-the-enemy/
MicroCapital.org: “MICROCAPITAL EVENT: Opportunity Collaboration Summit, October 17-20, 2009 in Ixtapa, Mexico”, July 29, 2009, https://www.microcapital.org/microcapital-event-opportunity-collaboration-summit-october-17-20-2009-in-ixtapa-mexico/
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