Abstract
In 2009, researchers from the Wharton School of the University of Pennsylvania published a list of the top 30 most important innovations over the last 30 years. On that list, which included items like the Internet, mobile phones and HIV anti-retroviral drugs, microfinance was ranked as number 17 (Wharton, 2009). What is it that makes microfinance so innovative that it deserves a spot on this and other lists similar to it? Does microfinance really live up to its hype as an effective tool for poverty alleviation? What can we learn about microfinance by examining its use and evolution in Latin America and the Caribbean (LAC)? This chapter examines these questions and more, by considering the good, the bad and the ugly of a growing microfinance market in LAC, noting the social benefits of increased access to microloans and other financial services, the obstacles and challenges that accompanied this expansion, and the controversy of commercialization.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Preview
Unable to display preview. Download preview PDF.
Similar content being viewed by others
References
Banerjee, A. V., E. Duflo, R. Glennerster and C. Kinnan (2009) ‘The Miracle of Microfinance? Evidence from a Randomized Evaluation’, Mimeo, MIT.
Bateman, M. (2010) Why Doesn’t Microfinance Work? The Destructive Rise of Local Neoliberalism (New York: Zed Books).
Bateman, M. and H. J. Chang, (2009) The Microfinance Illusion, available online at: http://www.econ.cam.ac.uk/faculty/chang/pubs/Microfinance.pdf (accessed 1 March 2012).
Beatriz Orlando, M. and M. Pollack (2000) Microenterprises and Poverty: Evidence from Latin America (Washington, DC: Inter-American Development Bank).
Beck, T., B. Büyükkarabacak, F. Rioja and N. Valev (2008) ‘Who Gets the Credit? And Does It Matter? Household vs. Firm Lending across Countries’, Policy Research Working Paper 4661 (Washington, DC: World Bank).
Berger, M., L. Goldmark and T. Miller-Sanabria (eds) (2006) An Inside View of Latin American Microfinance (Washington, DC: Inter-American Development Bank).
Campion, A., R. K. Ekka and M. Wenner (2010) ‘Interest Rates and Implications for Microfinance in Latin America and the Caribbean’, IDB Working Paper Series 177 (Washington, DC: Inter-American Development Bank).
CGAP (2004) ‘The Impact of Interest Rate Ceilings on Microfinance’, Donor Brief 18, available online at: http://www.cgap.org/gm/document-1.9.2376/DonorBrief_18.pdf (accessed 15 September 2011).
CGAP (2011) ‘What Do We Know about the Impact of Microfinance?’, in Consultative Group to Assist the Poor — About Microfinance, available online at: http://www.cgap.org/p/site/c/template.rc/1.26.1306 (accessed 15 September 2011).
Chowdhury, A. (2009) ‘Microfinance as a Poverty Reduction Tool — A Critical Assessment’, UN DESA Working Paper No. 89, December.
Christen, R. P. (2001) ‘Commercialization and Mission Drift: The Transformation of Microfinance in Latin America’, Consultative Group to Assist the Poor (CGAP): Occasional Paper no. 5, January (Washington, DC: CGAP).
Danel, C. and C. Labarthe (2008) ‘A Letter to our Peers’, Compartamos Banco, available online at: http://www.compartamos.com/wps/portal/Papers/Papers (accessed 15 September 2011).
Dichter, T. and M. Harper (eds) (2007) What’s Wrong with Microfinance? (London: Practical Action Publishers).
Economist, The (2008) ‘Microfinance: Doing Good by Doing Very Nicely Indeed’, 26 June, available online at: http://www.economist.com/node/11622469 (accessed 15 September 2011).
Epstein, K. and G. Smith (2008) ‘Compartamos: From Nonprofit to Profit’, BusinessWeek Magazine, 13 December, available at: http://www.businessweek.com/magazine/content/07_52/b4064045919628.htm (accessed 15 September 2011).
Hashemi, S. and R. Rosenberg (2006) ‘Graduating the Poorest into Microfinance: Linking Safety Nets and Financial Services’, Consultative Group to Assist the Poor (CGAP): Focus Note 41 (Washington, DC: CGAP).
Helms, B. (2006) Access for All: Building Inclusive Financial Systems (Washington, DC: World Bank).
Kiva (2011) About Us, available online at: http://www.kiva.org/about (accessed 15 September 2011).
Kumar, K., C. McKay and S. Rotman (2010) ‘Microfinance and Mobile Banking: The Story So Far’, Consultative Group to Assist the Poor (CGAP): Focus Note 62 (Washington, DC: CGAP).
Littlefield, E., J. Murdoch and S. Hashemi (2003) ‘Is Microfinance an Effective Strategy to Reach the Millennium Development Goals?’, Consultative Group to Assist the Poor (CGAP): Focus Note 24 (Washington, DC: CGAP).
Maes, J. P. and L. R. Reed (2012) State of the Microcredit Summit Campaign Report (Washington, DC: Microcredit Summit Campaign), available online at: http://www.microcreditsummit.org/state_of_the_campaign_report (accessed 1 March 2012).
Marulanda, B. and M. Otero (2005) The Profile of Microfinance in Latin America in 10 Years: Vision & Characteristics (Boston: ACCION International).
MicroBanking Bulletin (2007) ‘Bulletin Tables’, No. 14, Spring.
MicroBanking Bulletin (2010) ‘Bulletin Tables’, 20 September.
MIX Market (2011) Microfinance Information Exchange Database, available online at: http://www.mixmarket.org (accessed 15 September 2011).
Pantelić, A. (2011) ‘A Comparative Analysis of Microfinance and Conditional Cash Transfers in Latin America’, Development in Practice, vol. 21, no. 6.
Rhyne, E. and A. Guimon (2007) ‘The Banco Compartamos Initial Public Offering’, ACCION International InSight, no. 23, Autumn.
Rhyne, E. and M. Otero (2007) ‘The Landsc ape of Microinsurance in the Quality Gap’, MicroBanking Bulletin, no. 13, Autumn.
Roth, J., M. McCord and D. Liber (2007) ‘The Landscape of Microinsurance in the World’s 100 Poorest Countries’, MicroBanking Bulletin, no. 15, Autumn.
Sengupta, R. and C. Aubuchon (2008) ‘The Microfinance Revolution: An Overview’, Federal Reserve Bank of St Louis Review, vol. 90, no. 1, pp. 9–30.
Stephens, B. (2007) ‘Commercialization Continues Apace’, MicroBanking Bulletin, no. 14, Spring.
Stephens, B. (2008) ‘A Transformative Period for Microfinance’, MicroBanking Bulletin, no. 16, Spring.
Tejerina, L., C. P. Bouillón and E. Demaestri (eds) (2006) Financial Services and Poverty Reduction in Latin America and the Caribbean (Washington, DC: Inter-American Development Bank).
Trigo Loubière, J., P. L. Devane and E. Rhyne (2004) Supervising & Regulating Microfinance in the Context of Financial Sector Liberalization. ACCION International Monograph Series No. 13 (Boston: Accion International).
Wharton (2009) ‘A World Transformed: What Are the Top 30 Innovations of the Last 30 Years?’, Knowledge@Wharton — University of Pennsylvania, available online at: http://knowledge.wharton.upenn.edu (accessed 1 March 2012).
World Bank (2000) World Development Report 2000/2001: Attacking Poverty (Washington, DC: World Bank).
World Bank (2011) World Development Indicators, available at: http://www.worldbank.org/data (accessed 15 September 2011).
Editor information
Editors and Affiliations
Copyright information
© 2013 Ana Pantelić
About this chapter
Cite this chapter
Pantelić, A. (2013). The Implications of a Growing Microfinance Market in Latin America and the Caribbean. In: Manos, R., Gueyié, JP., Yaron, J. (eds) Promoting Microfinance. Palgrave Macmillan, London. https://doi.org/10.1057/9781137034915_2
Download citation
DOI: https://doi.org/10.1057/9781137034915_2
Publisher Name: Palgrave Macmillan, London
Print ISBN: 978-1-349-44205-8
Online ISBN: 978-1-137-03491-5
eBook Packages: Palgrave Economics & Finance CollectionEconomics and Finance (R0)