Sustainability and outreach in microfinance institutions in India: an ethical analysis

Milind SATHYE, Benugopal Mukhopadhyay, Suneeta SATHYE

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    Abstract

    We use an ethical analysis framework to explain the tensions that microfinance institutions (MFIs) face in following ethical practices when faced with the competing objectives of financial sustainability and social outreach. The extant view is that these institutions have to resort to unethical practices such as usury interest rates and forced loan collections to survive. After a case study of five MFIs, we find that this is not the case, and competing objectives can very well be achieved following ethical practices. This article is set against the background of suicides by microfinance borrowers in India.
    Original languageEnglish
    Pages (from-to)358-375
    Number of pages18
    JournalCanadian Journal of Development Studies
    Volume35
    Issue number3
    DOIs
    Publication statusPublished - 2014

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