Microfinance Messiahs?

On the ground… the MFIs’ growth is creating an unnerving situation. Even among those in the industry, there are fears of a mass-delinquency. In fact, Andhra is the most penetrated market in the world, on par with Bangladesh, says Daniel Rozas, a contributor at industry blog Microfinacefocus.com. “The state was already at 6% overcapacity a year ago. Explaining these numbers without allowing for extensive multiple borrowing is indeed a challenge,” he says.

an Economic Times in-depth report on rampant overlending by MFIs in Andhra Pradesh and Karnataka.