Why Doesn't Microfinance Work?

'Do Not Read This Book–if you wish to retain the myths attached to microfinance rather than enjoy and appreciate the best available scholarly, reasoned and readable critique.'-Ben Fine, professor of economics, School of Oriental and African Studies, University of London

'Bateman is the first to examine microfinance critically and coherently as a whole, and to take a sceptical, long-term view of its social and economic effects. Few readers will agree with everything he writes, but anyone who has any connection with microfinance should read this book. It should make us all think more clearly about what we are doing.'-Malcolm Harper, emeritus professor of enterprise development, Cranfield University; co-editor of What's Wrong with Microfinance?

'Milford Bateman's comprehensive survey and exposT of the microfinance business...is a timely, much-needed, and must-read book for anyone interested in the problems of development assistance.'-David Ellerman, former economic adviser to Joseph Stiglitz and Nicholas Stern at the World Bank; author of Helping People Help Themselves

Since its emergence in the 1970's, microfinance has risen to become one of the most high-profile policies to address poverty in developing and transition countries. It is beloved of rock stars, movie stars, royalty, high-profile politicians and 'troubleshooting' economists.

In this provocative and controversial analysis, Milford Bateman reveals that microfinance doesn't actually work. In fact, the case for it has been largely built on hype, on egregious half-truths and – latterly – on the Wall Street-style greed of those promoting and working in microfinance. Using a multitude of case studies, from India to Cambodia, Bolivia to Uganda, Serbia to Mexico, Bateman demonstrates that microfinance actually constitutes a major barrier to sustainable economic and social development, and thus also to sustainable poverty reduction.

As developing and transition countries attempt to repair the devastation wrought by the global financial crisis, Why Doesn't Microfinance Work? argues forcefully that the role of microfinance in development policy urgently needs to be reconsidered.