Disadvantages of Microfinance / Microloans. Risks

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Lahcen Harchaoui, Teacher, Morocco
The basic idea is benevolent and enabling, but experience has proved that many poor married women with microloans resort to prostitution to get the money to pay back, which affects the ethical side of the whole matter.

  Microfinance Stops Prostitution
Surendranath, India
In my opinion, it is the other way. Many women come out of it. Normally microfinance operates through self-help groups and participants are closely guided and monitored to achieve the targets.
  CONs of Microfinance
Tanveer Karamat, Pakistan
One cannot totally eliminate the misuse of any initiative even when it's designed for the betterment as a key driver. This is also true for microfinance. However MF must be pursued as the benefits by far outweigh the few disadvantages.
It is the selection of the right target market and execution excellence that determine it's success or failure.



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