Tag: Microloans

Microfinance Interest Rates

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Brett asked me why are microfinance interest rates so high? Turns out there has been lots of good discussion on this, the first is that “ADB”:http://microcapitalmonitor.com/cblog/index.php?/archives/284-Why-are-Microfinance-Interest-Rates-so-High-Asian-Development-Bank-Paper-Explains.html says rates at 30%-70% are effectively covering the high operational costs. It takes people to manage these microloans, so the banks don’t operate at a profit in effect, they…