“Who cares about the natural environment
in the microfinance lending process?”
Soon more than one hundred million people in the developing world will be receiving very small business loans through the investment vehicle known as microfinance (http://www.microcreditsummit.org/press/SOCR2006.htm). Most microfinance lending institutions (MFIs) appear to share the general intent to alleviate poverty for the borrowers (who are also commonly referred to as micro-entrepreneurs), and therefore offer funding for a wide range of business models with a panoply of potential side-effects. In my research I have learned of MFIs funding bicycle-based irrigation pumps only later to discover that their effective use had been the first big catalyzing step in drawing down the local water table with a proliferation of gasoline-powered portable generators which had in-turn been purchased with the profits from the bicycle-based pumps (Fisher 2006). I am concerned that microfinance is accelerating a haphazard industrial revolution, de facto. I am worried about the cumulative direct and side-effects of the actions of millions or billions of small scale entrepreneurs on the natural environment, especially if their business, like many, is agricultural in nature.
Contrastingly, I am inspired by instances I have found where MFI-funded development appears to be environmentally sustainable, prima facie: FIS microcredito finances and installs solar panels that electrify previously off-the-grid villagers in Argentina; PlaNET microfinance in Brazil hopes to one day include environmental protection language in the lending criteria of projects it funds; And locals in Bangladesh (who were later named Ashoka Fellows) transformed filthy streets and jobless beggars into a for-profit fertilizer business (Zurbrügg 2002). The purpose of my research is to explain the adoption of environmentally sustainable business models by some microfinanced entrepreneurs. My dissertation, which will be proposed late this summer, will be built upon a content analysis of MFI lending criteria, and it will seek to identify, understand and explain, “Who cares about the natural environment in the microfinance lending process?”
To this end I am building a
database of lending criteria documents from MFIs all over the world. I am happy to have any related documents in
any language. In the future I hope this
database can be used for research with other agendas, from gender issues to
best practices.
If you are an MFI lender please email
me your LENDING CRITERIA DOCUMENTS.
If you are a scholar doing research into
any aspect of microfinance I would love to have you join this working group
that I created:
http://finance.groups.yahoo.com/group/researchingmicrofinance/
Thank You,
Geoff Archer
PhD class of 2009 (Management: Entrepreneurship & Sustainability)
(and concurrently)
Instructor
of Entrepreneurship