Microfinance Challenge: Solvency of the Borrowers
ATBA Bouchaib, Member
The great challenge for associations or financing societies which manage microfinance operations, is the solvency of the borrowers.
In some cases, the actual debt not recovered may be several thousands of millions $, and, furthermore, the major proportion of it would never be recovered.
This problem can make a real constraint for the sustainability of the whole system.
In my opinion, financial risk management for these financing operations is a must.