By Peter Marchant, KF10 Azerbaijan
Microfinance interest rate discussions usually center on how much and often overlook the question of whether poor microborrowers should pay any interest at all. Kiva lenders are a philanthropic bunch. They could eliminate interest rates and cover administrative costs with donations, but for economic and ethical reasons they shouldn’t.
- Sustainability: The point of microfinance is sustainable development through broader access to capital. Donation capital is fickle, fluctuating and,...