Are women better customers?

In our last class, Ira brought up the fact that the WTCs and the MTCs (from our Rama Reddy case) showed the same delinquency rate - proving that men and women show equal risk as borrowers. However, most of our subsequent reading focused on women as better borrowers regarding their repayment rate. What do you think??

It seems to me that the WTCs and MTCs are set up in a way that levels the playing field between men and women. For example, the WTCs and MTCs require an accumulated contribution to withdraw greater amounts. Which means the delinquency would result in little to no additional loans, and motivate borrowers to repay. Perhaps the initial success of the WTC generated loyalty among the MTCs? Another explanation is that men, in fact, are not any more risky than women. That also brings up the question - is it low risk that is important...or high impact?

Any thoughts?

Why a flat rate interest rate structure

In class we discussed why you might charge a flat interest rate on a microfinance loan. Beyond its simplicity and the fact that this may the pricing that is already used in the informal market, it may also be a way of earning the most income while complying with government usury laws that cap interest rates. Thanks to Tanmay for pointing this out to me after class.

Welcome

Welcome to the PED-328 blog. A student in the class suggested I start a blog for everyone to share their thoughts about all things microfinance-related. So here we are. Please feel free to post interesting thoughts of your own or articles that you find interesting.