In India, greed creeps into microlending, critics say
Read in this blog relating story, click In India, greed creeps into microlending, critics say By Rama Lakshmi Washington Post Foreign Service Friday, October 29, 2010 NEW DELHI - The microcredit revolution has been celebrated for helping poor women in developing countries start small businesses. By lending them money for purchases such as a buffalo or sewing machine, the women were able to help lift their families out of poverty. But critics say the microcredit model has been perverted by commercial greed in India , with reports of abusive collection methods and sky-high interest rates. "What began as a simple, innovative model of providing credit for the poor women who were excluded from mainstream banks underwent a paradigm shift in India," said R. Subramaniam, principal secretary for rural development in Andhra Pradesh. "Many of these microfinance lenders morphed into for-profit companies six years ago." In the southern state of Andhra Pradesh, whi