For almost 35 years microfinance has been the golden child of development policy, offering the simple idea that lending very small amounts of money to very poor people can help them to help themselves get out of poverty.
But in the last six months, a series of scandals have hit the sector. Nobel Peace prize-winner and founding father of microfinance, Muhammad Yunus, has been removed from his position as head of the Grameen Bank, and faces accusations of corruption. And in Andhra Pradesh in India, there have been a series of suicides by indebted borrowers, provoking concerns about the coercive methods of some private sector microfinance lenders.
To discuss whether microfinance can be used effectively, Madeleine Bunting is joined by Cambridge economist Ha-Joon Chang, microfinance advisor at the NGO Care International Ajaz Khan and senior fellow at the Center for Global Development David Roodman.
We also hear from Vikram Akula, founder of SKS Microfinance.
