Microfinance: Issues In the Current Context
This keynote address draws on the "sakvithi" episode in Sri Lanka to derive lessons for microfinance practitioners. "Sakvithi" is a term that the Sri Lankan media uses for incidents where people who pose as microfinanciers deceive the poor of their money. The poor become suspicious about the entire microfinance industry as a result of such incidents. Sakvithi episodes teach important lessons on the governance structures that MFIs need to adopt and the self-discipline that microfinance beneficiaries need to cultivate. The widespread existence of spurious MFIs projects the entire microfinance industry as a fraudulent activity in the eyes of the public and law enforcement authorities. This is not a good sign for the future of the microfinance industry. To solve this problem and to ensure the future growth of the microfinance industry, the paper recommends that microfinance training programs give priority to the moral as well as technical development of microfinance practitioners.
