Relatively light and supportive regulation of microfinance, systematic and graded requirements for deposit taking, and a positive approach to foreign private investors make Cambodia a very popular destination for international social investors. Not surprisingly, over the past decade, Cambodian microfinance has gone from a largely NGO domain to a haven of commercial microfinance where international NGOs remain but mostly (now) as commercial investors gradually cashing in on their grant investments of the late 1990s and early 2000s.
It’s a question that comes up at nearly dinner discussion of microfinance: why are the interest rates so high, and how can poor clients afford them? So, you have the answer – interest rates are high because operating in difficult environments is costly, and because those costs have to be recouped from small loans.
This is part I of a two-part blog, summarizing some of the key findings of an edited volume that has just been released (Guérin I. Morvant-Roux S. Villarreal M. (eds) (2013) Microfinance, debt and over-indebtedness: Juggling with money, London: Routledge).
NpM, Platform for Inclusive Finance is a Dutch membership organisation focusing on the promotion of inclusive finance. What the member organisations have in common is their contribution to assisting the poor in getting access to finance.