Is Credit Irresistable?

A basic point I feel I have not pondered enough is that people who are financially cornered may borrow unwisely---at least sometimes. A Microfinance Insights article by Lilian Simbaqueba and Vitalie Bumacov of the Colombian credit-scoring company LiSim made me think of this now:

With limited access to mainstream credit services, the availability of an opportunity to borrow is overwhelmingly attractive to microcredit borrowers. A "good" opportunity, meaning availability of the right amount of loan at the right time, is a driving factor for microfinance clients to borrow, often without deliberate consideration of the potential risks involved....Even in a mature market like Peru, microfinance institutions have to "think for both" themselves and their clients. Easy availability of credit offers a bigger temptation for clients to borrow simultaneously from different sources. Competition among credit institutions may ease the approval or renewal of policies. If the MFI is not aware that the borrower has other current loans, it cannot asses the over-indebtedness of the applicant and, by consequence, can disburse a "low-risk" credit, which in reality is very risky for the client and for the institution. Microborrowers tend to hide this information while MFIs strive to obtain it. In the absence of a credit bureau, this task is nearly impossible.

Or consider a quote from Sanae Ito's 1999 Ph.D. thesis, which (the quote, that is) is based on a conversation with some teachers and a carpenter in southern Bangladesh:

[T]hey were of the opinion that [Grameen] Bank members who ran around desperately trying to borrow repayment instalment money from relatives and neighbours before the bank meetings could not possibly be experiencing any reduction in their poverty. When I asked them why they thought that the bank members were still so desperate to take loans despite such difficulties, the assistant head master answered: "It seems to me that they borrow to meet their immediate financial needs, which have no limits of course."

As it happens, Ito married Stuart Rutherford, an author of Portfolios of the Poor.Do you think Simbaqueba and Bumacov have a strong point here? Or are they, in their enthusiasm for their credit-scoring business, which is founded on the premise that borrowers cannot be trusted to filter themselves, somewhat exaggerating the importance of their work? Is Portfolios of the Poor more on-target in its humble trust in the ability of the poor to manage their own affairs?