'ReVista' Features Beth Rhyne on the 'Bolivian Model' of Microfinance

> Posted by Center Staff
ReVista: Harvard Review of Latin America has just released an issue that maps out Bolivia’s changing social, political, cultural, and economic landscape.
CFI Managing Director Beth Rhyne’s article “Microfinance: A World-Class Performance” takes readers on a tour of the “Bolivian model” of microfinance, which has “led to the transformation of dozens of MFIs around the world, launching the expansion of microfinance from a few tiny, donor-driven programs to a global industry that today brings access to financial services to 150 million people.”
Rhyne’s analysis begins:
When I first saw the photos of the sacking of BancoSol, I cried. The slide show began with chaotic pictures of the mob hauling desks, computers and files into the street and setting them on fire. Next were two captured looters lying face down and handcuffed amid the wreckage of what hours before had been a functioning bank branch. Finally, next-day photographs documented the ravaged premises of BansoSol’s branches all over La Paz and El Alto.
Thinking back to 2003 when these events occurred, I ask three questions. Why did protestors ransack a socially motivated bank that lends to the poor? Why did that make me cry? And what has become of BancoSol and the rest of the microfinance sector since then?
Development economist Claudio González-Vega once said of microfinance in Bolivia, “One could not write the recent economic history of Bolivia without highlighting microfinance, and one could not write the world history of microfinance without highlighting Bolivia.” (Boulder Finance Institute presentation, July 2007). Microfinance is one of Bolivia’s best claims to a world-class performance. It started in the late 1980s when idealistic Bolivian social activists created a series of microfinance institutions (MFIs). They found a ready market for small loans among Bolivia’s enormous informal sector, dominated by Aymara-speaking microentrepreneurs. The need, the services and the culture somehow clicked, and these MFIs quickly grew into leaders in the emerging global microfinance sector.
Please click the link to read the rest of “Microfinance: A World-Class Performance.”
ReVista, published three times yearly, focuses on different themes related to Latin America, Latinos/as, and the Iberian peninsula. The magazine-length publication brings together different voices on each theme, highlighting the work of Harvard faculty, students, alumni and visiting scholars.
Harvard’s David Rockefeller Center for Latin American Studies is ReVista‘s parent institution. The publication’s creators “hope to foster cooperation and understanding among the people of the Americas [and] seeks to contribute to democracy, social progress and sustainable development and to stimulate dialogue on these issues.”
Have you read?
The Center’s Best-Kept Secret: The Country-by-Country Client Protection Library (Featuring Bolivia)
A Tale of Microfinance in Two Cities
Pilar Ramírez, Microfinance Trailblazer
‘Weathering the Storm’ and Learning from Latin America’s Experiences
Microfinance
A World-Class Performance
By Elisabeth Rhyne
When I first saw the photos of the sack ing of BancoSol, I cried. The slide show began with chaotic pictures of the mob hauling desks, computers and files into the street and setting them on fire. Next were two captured looters lying face down and handcuffed amid the wreckage of what hours before had been a functioning bank branch. Finally, next-day photographs documented the ravaged premises of BansoSol’s branches all over La Paz and El Alto.
Thinking back to 2003 when these events occurred, I ask three questions. Why did protestors ransack a socially motivated bank that lends to the poor? Why did that make me cry? And what has become of BancoSol and the rest of the microfinance sector since then?
Development economist Claudio González-Vega once said of microfinance in Bolivia, “One could not write the recent economic history of Bolivia without highlighting microfinance, and one could not write the world history of microfinance without highlighting Bolivia.” (Boulder Finance Institute presentation, July 2007). Microfinance is one of Bolivia’s best claims to a world-class performance. It started in the late 1980s when idealistic Bolivian social activists created a series of microfinance institutions (MFIs). They found a ready market for small loans among Bolivia’s enormous informal sector, dominated by Aymara-speaking microentrepreneurs. The need, the services and the culture somehow clicked, and these MFIs quickly grew into leaders in the emerging global microfinance sector.

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