The Centre for the Study of Financial Innovation (CSFI), a nonprofit think tank that was established in the United Kingdom in 1993, recently published “Microfinance Banana Skins 2011,” CSFI’s third survey of the global microfinance industry. The survey, which was funded by Citi, a multi-national financial institution, and CGAP (Consultative Group to Assist the Poor), an independent policy and research center that is housed at the World Bank Group, comprises 533 responses from practitioners, investors, regulators and observers collected in November and December 2010. Respondents were asked to describe their main concerns about the microfinance sector over the next two years, to rate potential risks and to comment on how prepared they thought microfinance institutions (MFIs) are to manage the risks.
Compared to the previous Banana Skins report, dated 2009, the outcomes of the 2011 survey showed that, while credit risk remains on the top of the list, reputation risk and political interference are quickly becoming major concerns. The risk of mission drift has also risen with the perception that more MFIs are favoring making a profit over poverty alleviation.
By Julie Moksim, Research Associate
About Centre for the Study of Financial Innovation (CSFI): CSFI is a nonprofit think tank that was established in the United Kingdom in 1993. The center publishes reports and holds round-table meetings on developments in the financial services sector. CSFI’s goals include identifying new business areas and risks as well as initiating conversation about financial issues. CSFI publishes “Microfinance Banana Skins” reports that evaluate risk in the microfinance sector.
Sources and Resources:
Centre for the Study of Financial Innovation (CSFI): “Microfinance Banana Skins 2011, the CSFI Survey of Microfinance Risk”, http://www.cgap.org/gm/document-1.9.49643/Microfinance_Banana_Skins_2011.pdf
MicroCapital.org Brief, December 13, 2010: CGAP (Consultative Group to Assist the Poor) Solicits Input For “Banana Skins” Survey of Prospects for the Commercial Microfinance Industry, https://www.microcapital.org/microcapital-brief-cgap-consultative-group-to-assist-the-poor-solicits-input-for-?banana-skins?-survey-of-prospects-for-the-commercial-microfinance-industry/
MicroCapital.org Paper Wrap-Up, July 14, 2009: Microfinance Banana Skins 2009, Confronting Crisis and Change by David Lascelles and Sam Mendelson, https://www.microcapital.org/microfinanec-paper-wrap-up-microfinance-banana-skins-2009-confronting-crisis-and-change-by-david-lascelles-and-sam-mendelson/
MicroCapital.org Paper Wrap-Up, March 7, 2008: Microfinance Banana Skins 2008: Risk in a Booming Industry, by the Centre for the Study of Financial Innovation (CSFI), https://www.microcapital.org/?PHPSESSID=70d86aa1be1a7fba600a0b8cd40493d4&s=BANANA+SKINS&x=0&y=0
MicroCapital’s Microfinance Universe Profile: Centre for the Study of Financial Innovation (CSFI)
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