In an article on predatory lending and high cost credit providers published in The Economist last week, CDFIs were described as another option for those seeking microfinance at affordable levels:
“…But other options are emerging. Community development finance institutions (CDFIs), social enterprises that lend to low-income customers, charge much lower interest rates (20-50% a year). They can afford to because their repayment rates are much higher. Their loan officers operate like post-office lending once did, assessing risk on an individual basis and tailoring products to the borrower’s circumstances.”
cdfa member Scotcash is referenced, alongside Fair Finance who recently secured two mainstream bank loans to support their financial inclusion activity.
What next?
- Read the full article on The Economist website: http://www.economist.com/node/21531470
- See coverage of CDFA and CDFIs in the Press