Microlending has become a popular cause in the early 21st century. Behind the feel-good, do-good facade, though, it turns out that many microfinance institutions (MFIs) have fleeced thousands of borrowers, who are among the poorest people on Earth.
Hugh Sinclair fell into microfinance not long after earning his MBA. At the time, it sounded ideal: a way to use his skills to help the poor while traveling to some of the most remote and exotic locations on the planet, including Mexico, Mozambique, Mongolia and Nigeria. The longer Sinclair worked in microfinance, however, the more he saw that the bright dream concealed some nightmarish conditions. Interest rates pushing 200%, hidden fees, forced savings, illegal lending practices and creditor harassment have combined to make some borrowers poorer than they would ever have been without access to microfinance loans. Some borrowers have skipped town or even committed suicide in the face of loans they will never be able to repay. Meanwhile, many individuals, foundations and banks that fund MFIs don't seem to care what happens to the money they lend, as long as it's paid back--with a tidy profit.
Confessions of a Microfinance Heretic weaves Sinclair's personal experiences with concrete suggestions for fixing microfinance and economic information that's easy to follow. Half memoir, half exposé, this book is a must-read for anyone interested in economic and social justice. --Dani Alexis Ryskamp, blogger at The Book Cricket