Microfinance: Lords of poverty struggle to survive

Just a few years ago, Microfinance institutions were the lords of poverty, imperiously ruling over a new goldmine unearthed in corporate India, this one lying at the bottom of the pyramid. SKS Microfinance head Vikram Akula, posterboy of the industry claimed he wanted to be the ‘google’ of microfinance, using his company’s branding and reach to sell all kinds of goods through its pipeline to the poor. Despite warnings from industry veterans like SEWA founder Ela Bhatt and David Gibbons of Cashpor that companies like SKS and its peers were merely serving relatively well-heeled segments of the poor and creating ‘debt treadmills’ where one loan would be taken out to finance another, no one listened.

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