Microfinance boom could be bubble, some fear

Investing in institutions that provide credit to small firms and individuals in poor countries is increasingly popular – so much so, that there are brewing fears of a breakdown in lending practices. Catherine Contiguglia reports

Easy money? Some fear the booming sector is heading for trouble


It started out as a social experiment to extend credit to individuals and small businesses without access to traditional banking, but microfinance has become an asset class in its own right – generating more liquidity and cheaper funds, as well as less-welcome attributes, such as talk of asset bubbles.

"Microfinance is almost a victim of its own success, because the pressure to lend money can undermine credit standards. Microfinance has a strong track

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