Microfinance – Develop Economies

The Promise of Social Impact Bonds

August 13, 2012 Josh Comments 0 Comment

Over the past few weeks, social impact bonds have received a lot of attention. That is because New York City has partnered with Goldman Sachs to run a pilot program aimed at reducing recidivism among inmates at Rikers Island prison. But first, a little background on social impact bonds. There are many social problems for which there is no clear-cut solution. Homelessness, foster care, inmate recidivism, and other issues are often expensive to control. Programs designed to address them are…

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What Do I Think of Microfinance? Pt. 2

May 28, 2012 Josh Comments 0 Comment

This is part two of a two-part post on microfinance. Part one can be read here In the last post, I gave a rundown of the mechanics of microfinance and explained the criticism of high interest rates. Another criticism came from development economists like Dean Karlan, founder of Innovations for Poverty Action and pioneer in the utilization of randomized controlled trials for determining the efficacy of development interventions, and Jonathan Morduch, who, in his seminal book, Portfolios of the Poor,…

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Global Diasporas Create Economic Prosperity

December 28, 2011 Josh Comments 3 comments

The book review in the Wall Street Journal this morning discusses the Robert Guest book, Borderless Economics, which details how global labor movement increases trade, informational flow, communication, and technology. The topic of migration has been making the rounds, partly due to book reviews of Borderless Economics in all the major journals and magazines, but also because the time is right for a frank discussion about the realities of a global economy. Develop Economies agrees with all of Guest’s points. …

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The Myths and Realities of Impact Investing

August 19, 2011 Josh Comments 4 comments

“[Africa] is a wonderful place to really make money. We have one billion people hungry for everything.” Mo Ibrahim A friend posted an article on his Facebook wall titled “Why Social Impact Investing is a Crock,” leaving much to the imagination. Here is an excerpt: Over the last decade the world of do-gooding has seemingly been taken over by MBAs. Social entrepreneurship, a field encompassing both mission-driven businesses and entrepreneurial nonprofits, professes to bring the efficiency, rigor, and cold, hard…

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Saving as a Group

July 3, 2011 Josh Comments 0 Comment

The following is a guest post by Gemma North, an associate with Saving for Change, a community finance program run by Oxfam America. ?In 2009, I worked for a microfinance institution called CREDIT in Cambodia. On a field visit, I met a borrower who sold clothing and knick knacks to tourists visiting the nearby Angkor temple complex. She explained that her loan had helped her to expand her business and, as a result, she was planning on taking her kids…

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Kiva Launches Green Loans Category

April 25, 2011 Josh Comments 4 comments

A little more than one year ago, I was working with Negros Women for Tomorrow Foundation, a microfinance in the Philippines. NWTF was distributing low-cost solar lanterns to its clients. The clients were prone to constant brownouts due to the poor state of the electrical infrastructure in the rural areas, so the lanterns gave them a way to keep their businesses open after dark or let the children do work after the sun goes down. Having limited access to light,…

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Microfinance Documentary: “To Catch a Dollar”

April 3, 2011 Josh Comments 0 Comment

In an example of the relatively smallness of the world, a new documentary called “To Catch a Dollar” about the Grameen Bank and Muhammad Yunus’ good works has just been released. I hadn’t heard about it before, but my old man sent me a link yesterday to a news outlet called wickedlocal.com. As it turns out, the director, Gayle Ferraro, hails from my hometown of Westwood, Massachusetts, a small suburb located 20 minutes south of Boston, on exit 16B off…

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The Battle for the Soul of Microfinance

March 27, 2011 Josh Comments 4 comments

Microfinance is going through some major growing pains right now, hitting its first major challenge since it hit the mainstream in 2005 after Muhammad Yunus won the Nobel Peace Prize. The “silver bullet” of poverty alleviation that brought credit to those previously thought unworthy of a loan has seen an onslaught of criticism for failing to deliver on the lofty goals that its evangelists believed it could achieve (lesson: don’t overpromise). Studies have shown that the impact of providing credit…

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Impact Investing: Venture Capital for Do-Gooders Takes Off

January 25, 2011 Josh Comments 2 comments

The other day a friend put me in touch with a friend of his who had just moved to Accra. She works the Acumen Fund, a social venture capital fund that invests in promising entrepreneurs in developing countries. The use of the adjective “social” is a bit misleading, in the sense that the companies are purely for-profit and do not need to have an explicit social motive guiding the business strategy. What distinguishes them is the market they serve, termed…

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