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David Roodman's Microfinance Open Book Blog


Ramesh Arunachalam's blog is following and commenting on the Andhra Pradesh microcredit crisis in detail. At least for an American outsider like me, the blog is a bit awkward and disorienting---there is no explanation of who the "Indian Micro-Finance Blog Team and Ramesh Arunachalam" are. But if you persist in perusing, you'll find content found nowhere else. It seems as if the author(s) come from the microfinance industry and yet are quick to criticize it, which gives them credibility.

One post tells the story of Zaheera Bee, who committed suicide, in words and harrowing statistics. Another contains direct (translated) quotes from clients on the definition of coercive debt collection. I find this extremely valuable because among all the loud voices on the crisis (including mine), those of clients have barely been heard. I hope the "Candid Unheard Voice of Indian Microfinance," as the blog tags itself, brings us much more of this, so that those voices and the blog will in fact be heard.

Examples (all emphases in the original):

Client A: “The fact that fieldworkers/agents came day after day (for week after week) and pressured me to pay back is itself a sort of harassment and coercion. As I (and family) do not have serious livelihood means, we have to either borrow from another MFI (this would help consumption and also repayment for some time) or borrow from money lenders (at even 10% per month) to pay them and get them off our backs. The idea is WE HAVE TO SOMEHOW PAY THEM or they will not leave. When all options of borrowing run out, we either have to migrate or die. This is what is happening to other women and may happen to me someday soon”

Client B’s Husband: “My wife who committed suicide, had taken 8 loans and had to pay back 2 loans on Monday, 1 Tuesday, 1 Wednesday, 1 Thursday, 1 Friday, 1 Saturday (every fortnight one), and 1 once a month. There was no respite during the week and on Saturday, she felt happy that Sunday was the next day but that was short lived as we had to make payments from Monday again and the whole cycle continued…When one has to pay loan repayments on 6 days a week and people will not leave without collecting payments, it is downright harassment.”

Client H: Another client said, “The earlier support (SHG) groups have now become pressure groups that insult. So there is no respite and harassment is 24x7 as group leaders and other members live at the village itself and they obstruct participation in village activities if the loan installments have not been paid. You just cannot get away without paying as they have a lot of local influence and can do anything…”

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