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Chapter 4

Another Mozambican Civil War

 1. See “FCC – Fundo de Crédito Comunitário, Audit Report,” September 30, 2004,

 2. Available at Set the years of interest to generate a report; I suggest 2002 onward.

3. Only the quotes are taken directly from the report. The explanations and comments are my interpretation.

5. See

6. Still announced on

Appendix Microfinance 101

1. Steve Beck and Tim Ogden, “ Beware of Bad Microredit,” Harvard BusinessReview online (September 2007).

2. See Michael Chu’s presentation to Canning House, April 24, 2006; on book website.

3. Bateman and Chang, “Microfinance Illusion,” pp. 8, 14.

Chapter 13

The Good, the Bad, and the Poor

 1. David Roodman, “Last Chapter Revised!” Center for Global Development, David Roodman’s Microfinance Open Book Blog, April 29, 2011,

 2. M.S. Sriram, “What Is Wrong with Indian Microfinance,” Forbes India, May 5, 2010, at

 3. For example, see “Q&A with Muhammad Yunus,” Enterprising Ideas: Social Entrepreneurs at Work,

 4. Burson-Marsteller Watch, (also Rachel Maddow quote).

 5. Dan Lyons, “Facebook Busted in Clumsy Smear on Google,” The Daily Beast, May 11, 2011, at

 6. AMT email correspondence.

 7. LAPO’s profile is available on[page]=1&vdreports[profile]=22.

 8. Letter from AMT to LAPO.

 9. See

10. The LuxFLAG website,

14. See Phil Mader’s blog “Governance Across Borders,” part of the Max Planck Institute,

Chapter 12

Collapse, Suicide, and Muhammad Yunus

 1. Elyssa Pachico, “’No Pago’ Confronts Microfinance in Nicaragua,”, October 28, 2009,

 2. David Roodman, “Death of a Microfinance Institution,” Center for Global Development, David Roodman’s Microfinance Open Book Blog, August 9, 2010,

 3. “6 Microfinance Crises That the Sector Does Not Want to Remember,” Microfinance Focus, April 22, 2011,

 4. See (in Spanish)

 5. Elizabeth Minchew, “A Movement to Acknowledge: The Nicaraguan Movimiento No Pago,” Microfinance Focus, September 14, 2011,

7. Center for Financial Inclusion, “Nicaragua’s Microfinance Crisis: Looking Back, What Did We Learn?” Microfinance Gateway, January 26, 2011,

 8. Microfinance investment funds issue press release in Nicaraguan media.

 9. Iván Olivares, “Millones en Riesgo por ‘Ley de No Pago,’” Confidencial, March 8, 2010.

10. Rohan Trivedi, “Microcapital Brief,”, September 2, 2011,

11. Matthew Fuchs, “Lessons Learned from Microfinance Crises: Viewpointsfrom Investors,” at Microfinance Focus, November 4, 2009,

12. International Association of Microfinance Investors, “Charting the Course: Best Practices and Tools for Voluntary Debt Restructurings in Microfinance”

(New York: IAMFI, 2009), available at

13. Patricia Padilla, The Micro-Financing Institutions Are Politically Very Attractive,” Envio Digital, August 2008,

14. Milford Bateman and Ha-Joon Chang, “The Microfinance Illusion” (March 2009), p. 12, available at [page 12]

15. Sanjay Vijay Kumar, “Microfinance Industry in India to Cross 11 Crore by 2014: Microfinance & Business India Digest,” Microfinance Africa, June 14, 2010,

16. Ketaki Gotkhale, “As Microfinance Grows in India, So Do Its Rivals,” Wall Street Journal, December 15, 2009,

17. Ketaki Gokhale, “Group Borrowing Leads to Pressure,” Wall Street Journal,August 13, 2009,

18. Vikram Akula, reprinted in Welcome to Paradox Valley blog, August 22, 2009,

19. “SKS Microfinance Ranked No. 1 MFI in India by Mix Mkt,”,January 2, 2009,

21. Shashi Tharoor, “The Crisis of Microfinance,” Aljazeera, March 11, 2011,

22. “Agents Kidnap Girl to Punish Mother for Loan Default, Times of India, October 13, 2010.

23. “SKS and the Crisis of Corporate-Led Microfinance in India,” Pragoti,February 2, 2010,

24. “54 Committed Suicide in AP Due to Microfinance Debts, Says SERP: Report,” International Business Times, October 29, 2010,

25. “Exclusive: 54 Microfinance-Related Suicides in AP, Says SERP Report,”Micofinance Focus, October 25, 2010,

26. Erika Kinetz, “Suicides Spark Scrutiny of Indian Microfinance,“ Bloomberg Businessweek, October 19, 2010.

27. Sebastian Strangio, “Is Microfinance Pushing the World’s Poorest Even Deeper Into Poverty?” The New Republic, December 14, 2011.

28. Jinka Nagaraju, “MFI Agents ‘Forcing’ Debtors to Commit Suicide: Study,” Times of India, October 20, 2010 .

29. “Is the Mexican Microfinance Sector Approaching Crisis Point?” Microfinance Focus, July 17, 2011.

31. “Grameen Foundation Complains to NRK,” Flip the Coin, February 22, 2011,

32. Ministry of Foreign Affairs: “Norad’s report shows that Grameen Bank transferred a total of NOK 608.5 million to its sister company Grameen Kalyan in 1996. Norway’s share of this amount is estimated to be approximately NOK 170 million. The Norwegian Embassy in Dhaka reacted immediately when it discovered the transfer in 1997. In the embassy’s view, the transfer was not in accordance with the agreement. The matter was raised with Grameen Bank. Following negotiations, it was agreed in May 1998 that NOK 170 million was to be transferred back from Grameen Kalyan to Grameen Bank,”

33. David Roodman, “U.S. Government Pressure on Behalf of Yunus,” Center for Global Development, David Roodman’s Microfinance Open Book Blog, February 28, 2011,

34. No author stated:

35. See Norad, “Review Commissioned by the Norwegian Ministry of Foreign Affairs of Matters relating to Grameen Bank,” December 6, 2012,

36. See also the Wikipedia entry on the subject, which states, “NORAD published an official statement clearing Yunus and Grameen Bank from any wrongdoing.” This is open to interpretation on the exact meaning of the word clearing, but the truth appears slightly less clear-cut than the mainstream media cares to present. See the section “Disproved allegations from a Danish documentary,”

38. The site,, was temporarily closed and then restored, document available here.

40. “Yoghurt Adulteration: Yunus Lands in Court,” Rediff Business, January 28, 2011,

41. David Roodman, “The Persecution of an Imperfect Man,” Center for Global Development, David Roodman’s Microfinance Open Book Blog, January 29, 2011,

42. “Yunus Criticizes Profiteering in Nigerian Microfinance,” micro- DINERO, September 7, 2011,

44. See

Chaper 11

Enter the New York Times

 1. Neil McFarquhar, “Banks Making Big Profits From Tiny Loans,” New York Times, April 13, 2010.

 3. See, for example, Stephanie Strom, “Confusion on Where Money Lent via Kiva Goes,” New York Times, November 8, 2009.

 4. See pp. 12–13 of the 2009 Planet Rating: “The insufficient transparency in reporting to funders in December 2008, combined with the Nigerian economic crisis, detracted some potential investors in 2009 and contributed to a request for early repayment.”

 5. See, for example,

 7. See,1028.160.html.

 8. Lauren Smiley, “Kiva’s Microloans Underwriting Cockfighting in Peru,” SF Weekly, February 27, 2008.

 9. See Kiva Lending Team: Kivans Against Cockfighting Loans,

10. See the Skoll Foundation website,

11. Note the discussion at,3447.msg77346.html msg77346.

12. See, for example, the account at, together with a photo showing large bags of coca leaves.

13. Dave Algoso, “Truth in advertising: ChildFund, Kiva, and Bolsa Família,” Find What Works blog, September 10, 2010, See also “Disappointing: Kiva Is Hosting Loan-Sharks,” A Division by Zer0 blog,

14. See the Kiva Microfunds IRS Form 990 2009, p. 50,

16. Kiva Microfunds (A Nonprofit Organization) Financial Statements for the Years Ended December 31, 2010 and 2009, p. 16, available at

19. “Infoporn: Kiva’s Microloan Map of the World,” Wired (February 2012);


Kiva lending in 2010 was £45.5 million (not USD), suggesting that my figure is in fact conservative.

21. Reported at

22. See Triple Jump B.V. Financial Statements 2010,

24. See the Kiva partner web pages at and, respectively.

25. See the Kiva partner web page for ASI Federal Credit Union,

26. Reported on Kiva Microfunds IRS Form 990 2010, pp. 18–28,

28. Report on MiCredito,, July 7, 2011,

29. Available at

30. The latest statistics are at

31. See; also see the section entitled “Full-repayment frequency uncertainty.” just above the section on Bloodsports.

32. On

33. All emails are reproduced here.

35. “New York Times Article on Microfinance Interest Rates and Profits,”

36. See

37. Full press release on book website, or

38. See the Schwab Foundation Board of Directors,

39. See Grameen Foundation USA Board of Directors, Muhammad%20Yunus,%20Director,%20Emeritus.

40. Alex Counts, “What Is the True Cost of Microfinance,” Grameen Foundation,

41. Original press release on book website, removed from LAPO website.

42. The newsletter Connections (Fall 2007), removed from its website; copy on book website, or from MIX Market:

43. “LAPO: Case Study on Due Diligence by Microfinance Funders,” Givewell blog,

50. See; a preview of the documentary is available on this site.


52. The video footage of this question was provided by Tom Heinemann.

to download this video click here

53. BlueOrchard defence of LAPO investment

54. Nisha Koul, “Microcapital Brief,”, October 17, 2011,

55. See, as well as the footnote buried at the bottom of the website: “An initiative of The Center for Financial Inclusion at ACCION International.”

Chapter 10

Blowing the Whistle from Mongolia

Full recording and transcript of call with Calvert Foundation.


 1. See

2. Press releases section of MicroRate website, August 2009.


3. Or, more accurately, the “expiration” of its rating. LAPO’s own rebuttal to the press release referred to it three times as a withdrawal, so I use LAPO’s term. The LAPO response to MicroRate’s press release is available on book website.

 4. Lift Above Poverty Organization (LAPO), Nigeria (Dakar: Planet Rating, 2009). The Planet Rating LAPO report is available at



 9. See also LAPO press release subsequently removed from LAPO website.

18. Receipt of $25 investment in Calvert Foundation.

19.Complaint to Calvert Foundation

20. All photos are on the book website. ASN Novib’s is visible online, on p.19 of the February 2008 Spaarmotief magazine on the ASN website,; screenshots from the NOTS Foundation and Calvert/MicroPlace websites appear on book website; Calvert Foundation’s photo can be seen on

21. Calvert Foundation response to letter of complaint.

22. She was promoted to president and CEO in 2011.

23. The video was recently removed from , but is available here.

If you can't watch the video, download it from here

24. See the second paragraph of page 2 of his testimony, available at

25. The video was recently removed from , but is available here., see footnote 10.23 above.

26. Robert Pouliot, “Governance, Transparency, and Accountability in the Microfinance Investment Fund Industry,” in Ingrid Matthäus-Maier and J.D. von Pischke, eds., Microfinance Investment Funds: Leveraging Private Capital for Economic Growth and Poverty Reduction (Berlin: Springer-Verlag, 2007), p. 150.

27. The video was recently removed from , but is available here., see footnote 10.23 above.

Chapter 9

Rustling Dutch Feathers

 1. See the summary at It was previously publicly available here.


 3. This is available by subscription only. See However, MicroRate has kindly permitted me to upload the full report to the book website as an act of transparency, for which I am grateful.


8. The recording of this question is on the book website. I was unable to record the response because my phone permitted only 60 seconds of recording. A full transcript of the AGM may be available from ASN Bank.


9. Response to author from ASN Bank.

10. Spaarmotief, July 2009. (in Dutch).

11. Response from Oxfam Novib to author, dated November 12, 2009.

12. Regulatory and Supervisory Framework for Microfinance Banks (MFBs) in Nigeria.

13. “Grameen Foundation Supports Citibank’s USD 1mm Financing of Nigerian Microfinance Institution LAPO,” MicroCapital, May 11, 2007,

14. Email communication with Robert Annibale of Citi.

Chapter 8

In Front of the Judge

 1. Dated March 20, 2008.

 2. Available on book website, or from the Amsterdam cantonal court for €2.50.

Case EA 2008-533, ruling of 28 April 2008 (in Dutch).


Chapter 7

Something Not Quite Right in Holland

2. Farouk Kurawa, Dave Odigie, Kayode Faleti, and Elizabeth Ellis, Partnerships That Work: Alleviating Poverty in Nigeria through Microfinance, p. 9; available at OdigieFaletiEllis_FullPaper.pdf.

 3. See p. 60 of Oxfam Novib 2008 annual report.

 4. See p. 5 of the document Investeringen O-N 2009.pdf.

 5. Planet Rating report of LAPO 2011, available from by subscription only.

 6. See Planet Rating report of LAPO 2011, p. 4.

 7. This formed a key part of the documentation subsequently presented to a Dutch judge.

Chapter 5

The “Developed World”

 1. See its “business philosophy”

 3. See

 4. See

 5. Reported at

 6. Chuck Waterfield, “Explanation of Compartamos Interest Rates,” May 19, 2008,

 7. Ira W. Lieberman, Anne Anderson, Zach Graffe, Bruce Campbell, and Daniel Kopf, Microfinance and Capital Markets (n.p.: Council of Microfinance Equity Funds, 2008), p. 18,

 8. Roodman, “Does Compartamos Charge 195% Interest?”

9. See, for example, for a good summary of Compartamos. Some valuations are estimated, or depend on the share price at a certain point in time. What is beyond doubt, and visible on websites such as, is that Accion International’s net assets grew from $34 million in 2006 to $332 million in 2007, an increase of $298 million in one year. This same website publishes the 2009 salary of the CEO, but not for previous years. See also Focus Note no. 42, p. 14,, or “The Implications of Increased Commercialization of the Microfinance Industry,” MFI Solutions/ La Colmena Milenaria, July 2008, p. 9,, which states that the immediate sale of 50 percent of Accion’s shares in Compartamos earned them US$134,965,740 net of fees, suggesting a total valuation of just under $270 million, and accounting for over 90 percent of the increase in net assets that occurred over this period.


11. “Implications of Increased Commercialization of the Microfinance Industry,” p. 6.

12. Accion IRS Form 990 2008, pp. 34 and 35, available on book website, described vaguely as “investment”.

13. Accion IRS Form 990 2009, p. 9.

14. See, at minute 31.

15. IRS Form 990 2010, p. 43,

16. Steve Beck and Tim Ogden, “Beware of Bad Microcredit,” Harvard Business Review, September 2007; summary available at

17. David Lascelles and Sam Mendelson, Microfinance Banana Skins 2011: The CSFI Survey of Microfinance Risk (London: Centre for the Study of Financial Innovation, 2011); available at

Chapter 3

Bob Dylan and I in Mozambique

 1. World Relief FCC Review of Funding Situation, May 15, 2003, slide 3.

Chapter 1

Thou Shalt Not Criticize Microfinance

 1. According to the 2011 Global Microcredit Summit, 205,314,500; 153,306,542 of whom are women.


4. Duvendack et. al., What Is the Evidence of the Impact of Microfinance on the Well-Being of Poor People?

(London: EPPI Centre, University of London, 2011), p. 75.


5. One of the pioneers of commercial microfinance has coined the phrase “goat economics.”



6. David Roodman, “Does Compartamos Charge 195% Interest?” Center for Global Development, David Roodman’s Microfinance Open Book blog, January 31, 2011,


7. Jonas Blume and Julika Breyer, Microfinance and Child Labour (Geneva: International Labour Office, 2011). Only one microfinance fund has explicit policies regarding child labor: World Vision, which operates a number of MFIs through its subsidiary Vision Fund.


9. See


10. Vivienne Walt, “Does Microfinancing Really Work? A New Book Says No,”Time, January 6, 2012.


11. See Nicholas Kristof, “The Role of Microfinance,”, December 28, 2009,


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