Monday, 8 April 2013

Microloans: the good, the bad and the ugly - a report on TorontotheBetter's screening of Micro-lending: a Critial Investigation

As part of our Rethinking Social Enterprise campaign to make social Toronto's enterprises more arffordable and  accessible for the 99% TorontotheBetter recently screened Tom Heinemann's "Micro-Debt: a Critical Investigation", an investigative movie about Nobel Peace prize winner  Mohammed Yunnus. Yunnus was the parent of the micro-loan idea, which promotes the use of small, in principle easily repayable, loans to the poor as a way of ending or at least alleviating their poverty. Many NGOs and agencies have since turned to micro-loans as a development strategy. Heinemann found the reality for many microloan receivers in Bangladesh was far different from Yunnus' rosy picture, with penurious interest rates and insistent lenders making their lives a misery, to the point of suicide in some cases. 

The TorontotheBetter audience  at our screening felt that Heinemann had been fair to Yunnus, notwithstanding the satirically Christ-like pose used for Yunnus in advertising for the movie. But for a variety of reasons the micro-loan hype exceeds, or contradicts, the benefits for many. Like many social enterprises, the micro-loan phenomenon began with generous motives, but for a number of reasons, whether it was Yunnus personal failings (fame and fortune got the better of him), or a wilful neglect of reality - a capitalist context characterized by predatory financial institutions, or simply the difficulty of operating a business when you're undeucated and dirt-poor, -  our audience was split about these - micro-lending needs serious modification and regulation before it could be generally adopted as a serious poverty alleviation approach. A more fundamental question perhaps is whether business can ever be a way out of traps the marketplace created in the first place.

To borrow a copy of the video contact TorontotheBetter at postmaster is a sad and cautionary tale. Several years after the movie was released Heinemann tells TorontotheBetter the Yunnus group refuses to speak to him.

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