The dark side of competition: credit risk and market penetration
by Xavier Reille: Thursday, February 25, 2010
At an investors’ conference two years’ ago, microfinance* was presented as a promising untapped market at the bottom of the pyramid with a market penetration of only 1% and a funding gap of USD 250 billion.
The recent delinquency crises affecting Bosnia and Herzegovina (BiH), Morocco, Pakistan and Nicaragua described in our new Focus Note “Growth and Vulnerabilities” paint a different picture. Too many–not too few–microcredits seem to be the problem in these markets.
