The idea of microfinance - known internationally as giving small loans to poor individuals typically to help them with a business - has exploded in use over the past fifty years. Muhammad Yunus was one of the early pioneers of this financial product and arguably its loudest champion. Despite its intent to help individuals solve a problem or need, it has also indebted many others. Mara Kardas-Nelson offers a very candid and honest look at both sides of the microcredit coin in We Are Not Able to Live in the Sky.
Kardas-Nelson relays two stories in her book. The first is the rise of microcredit as an industry - from Yunus’ Grameen Bank in Bangladesh to Accion in the US to Fedecredito in El Salvador - and how policy decisions and smooth talking helped pave the way for a burgeoning market for loans. The drawback is that many of those loans were high interest or high fee, which meant that repayment was often difficult and many individuals ended up worse off than before. The other stories weave through Sierra Leone and a family that was heavily in debt due to microcredit and how through bribes and the legal system they faced more challenges with a high interest rate in repaying their relatively small loans.
The author does a good job showing the pitfalls of lending without any sort of regulations and safeguards to protect individuals. She also briefly mentions the importance of education, although financial literacy in general could have been amplified more heavily. Her solutions (universal basic income) may not be a panacea to fix poverty among the poorest of the global population, but at least Kardas-Nelson presents a very authentic reality on how lending can be quite predatory, even under the guise of good intentions, and that lenders who do engage in microfinance need to do better in this regard.
MY RATING: 4.5
