Internship Countdown - 7 Days to go
My time in Quito is now winding down. I have one week left here . . . with my 7 hours of Spanish every day.
Microfinance is in the news quite a bit here in Ecuador. In fact, it is an interesting time to be here. The federal government is trying to pass a new banking law. There are provisions in the proposed law that have implications -- and serious ones -- for the Microfinance/Microcredit community.
Most importantly, the government is proposing to impose a limit on interest rates. Generally speaking, Microcredit organizations HAVE to charge higher rates. Why? Well, there are many reasons, but the main one is that it is just as expensive to administer a loan of $200 as it is to administer a loan of $20,000. A Microcredit portfolio is much more expensive to manage.
Suffice to say that things should be interesting.
Microfinance is in the news quite a bit here in Ecuador. In fact, it is an interesting time to be here. The federal government is trying to pass a new banking law. There are provisions in the proposed law that have implications -- and serious ones -- for the Microfinance/Microcredit community.
Most importantly, the government is proposing to impose a limit on interest rates. Generally speaking, Microcredit organizations HAVE to charge higher rates. Why? Well, there are many reasons, but the main one is that it is just as expensive to administer a loan of $200 as it is to administer a loan of $20,000. A Microcredit portfolio is much more expensive to manage.
Suffice to say that things should be interesting.
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