In July, CGAP highlighted the distinctive management of Shafiqual Choudhury of ASA, our community member in Bangladesh. He performed a number one position in averting a microfinance disaster threatening the nation, just like ones that affected Nicaragua, Morocco and Bosnia and Herzegovina.
Excerpt:
In 2007, Shafiqual Haque Choudhury, the founder and president of ASA, one of many largest MFIs, remarked, “Extreme lending right into a saturated market may trigger a ‘practice crash’ that may trigger nice sector-wide harm and burden debtors with money owed they didn’t want.”
Choudhury took an easy view, “if debtors take too many loans they are going to run into compensation issues, and would cease repaying me or another person.”
As a substitute, every MFI slowed progress in its personal manner. . .ASA was the primary massive MFI to take unilateral motion.
Bangladesh was lucky to keep away from a descent into an unpredictable or spiraling deterioration. MFIs could have prevented a disaster for themselves by placing their very own homes so as, however the place does that depart their purchasers? Because the market expanded quickly within the high-growth interval, had been purchasers dangerously over-indebted?
Shafiqual Choudhury of ASA, who had been among the many most vocal in warning of the hazards to purchasers of over indebtedness now says that “the practice crash was prevented.” On the entire, the proof from our family interviews in early 2013 helps this conclusion.
Obtain “A Microcredit Disaster Averted,” CGAP’s July 2013 Focus Shafiqual Choudhury of ASANote
