Sustainable Microfinance - Balanced Scorecard's added value for ...

AP Somebody has an idea and than they do the same. Those people create a stiff competition for each
other
AP There has been created a big myth around microcredit, a view that costumers start a business, that
that works successfully and that they hire employees. That is nonsense, absolutely nonsense.
AP in developing countries the MFI usually are sustainable.
AP The competition is increasing, in the first years it did not matter what you did, you would 'get ride of'
your money any way, get ride of, be able to disburse enough loans.
AP Now you see the competition increasing and the more professional your organization is, the better you
will get out of that battle
AP there is a bubble growing under the microfinance market. In some countries the bubble already
bursted. A lot of people had too much loans and just couldn't pay back anymore, causing the MFIs to
default.
AP When you provide a loan of hundred euros, than you cannot add a lot of extra costs, because it needs
to remain financially sustainable. On a bigger loan you can do more.
AP There is a gap between MFI and big banks. In between it is difficult to find finance, which is also the
gap where more the real entrepreneurs are, the SME.
AP The missing middle, loans of !10.000 - !100.000. Those amounts are too big for the MFI and too small
and risky for the mainstream banks. That is the birth room of entrepreneurship.
AP the focus should be on that group, because they have the most growth potential,
AP everybody that is in the missing middles comes from the MF sector. How do you make sure that from
the MF those people flow to the next level?
AP I find the idea of microcredit in the Netherlands relatively ridicule,
AP I can imagine that in the Netherlands the primary goal is to make that sustainable.
AP maybe it can not be financially sustainable, but as a society we find it so important that we want to
spent public money on that. Make a clear decision on that.
AP That really depends on your objectives, do you only want to focus on those entrepreneurs, where you
know or expect that they will make it.
AP upfront you can never predict that, in that sense it will be a guess.
Elmar Hoogendoorn 135
Sustainable Microfinance