Microfinance Focus, 25 November 2012, Co-authored with Vikash Kumar
This article is part of a series aimed at understanding what’s happening in India’s affordable housing sector. It is based on interviews with residents of three low-cost housing projects: Vaishnavi Sai (outside Mumbai), Anandgram (outside Pune), and Janaadhar Shubha (outside Bangalore). The interviews were conducted during May-June 2012. Read Part 1 here.
After a long train ride – nearly two hours – the line ends. Passengers disembark at a small, but bustling community, easily covered on foot. The commerce around the station is busy, but within a few city blocks, one already spies farmland beyond the last rows of houses. Residents of all stripes live here, but the feel is decidedly working-class.
This could easily be late 19th century streetcar suburb outside Chicago or New York. Or a fin-de-siècle banlieue on the outskirts of Paris. But no, it’s Virar, one of the terminal stops on the Western Railways line heading north out of Mumbai. Read full article here.
Microfinance Focus, 16 October 2012, Co-authored with Vikash Kumar
This article is part of a series aimed at understanding what’s happening in India’s affordable housing sector. It is based on interviews with residents of three low-cost housing projects: Vaishnavi Sai (outside Mumbai), Anandgram (outside Pune), and Janaadhar Shubha (outside Bangalore). The interviews were conducted during May-June 2012. Read Part 2 here.
Something is afoot in the low cost housing market in India. Over the last two years, dozens of commercially-built projects targeted at the lower middle class have been going up in cities across the country, with tens, if not hundreds, of thousands of units being built. In the past six months, many of these projects have begun opening their doors to the new residents. We decided to pay some of them a visit. more →
European Microfinance Platform, August 2012 Newsletter
Allow me an impertinent question, dear reader: what was the largest loan you ever borrowed? Now, let me venture a guess – was it your home mortgage? If you answered no, then you probably fit either of three profiles: 1) you never had to buy a home, 2) you live in a country with limited financial access, or 3) you are very lucky.
Let’s set luck aside for the moment. Why the first two assumptions? Because in developed countries, mortgage finance takes by far the largest share of consumer credit. In the US, mortgages on residential property account for 84% of average household debt. In the UK, the number is 89%. There is no question that the primary goal of retail lending in rich countries is to fund housing. Now consider the numbers for housing loans in the microfinance sector.
They are depressingly small. more →
Financial Access Initiative, 5 July 2011
What does a microlending operation look like? Well, it may be a bank or an NGO (and many others in between), it probably has some branches, branch managers, loan officers. The funding of the MFI may come from deposits or from debt, whether from a local or foreign institution, including from online platforms such as Kiva. There may be variations on these themes, but that pretty much describes microlending as we know it.
What if you took all that away – the branches, the loan officers, the institutional funders? Could the lending still work? Well, one model is that of Zidisha Microfinance, an online lending platform that connects lenders in (mostly) developed countries with borrowers in developing ones. And, unlike Kiva, the connections are real – borrowers create their own online profiles, post their own loan applications, and make their own repayments. They also post their own comments, as do the lenders. There is no local MFI intermediary – it is literally the first true person-to-person (P2P) microfinance lending platform in the world. more →