Mega-interest on Microcredit: Are Lenders Exploiting the Poor?

Journal of Applied Philosophy 29 (3):169-185 (2012)
Microcredit is often hailed as an effective way of alleviating poverty. In recent years, however, microfinance institutions have been the target of much criticism due to their comparatively high interest rates (which may be as high as 70–100% per annum). This paper discusses whether it can be morally justified to charge very high rates of interest when lending money to the poor. Arguments are drawn from contemporary as well as historical debates on usury, exploitation, egalitarianism and consequentialism. It is conceded that it would be preferable if interest rates could be reduced, but it is argued that typical microlenders today do nothing wrong in setting their rates at the current levels. Instead the responsibility rests on governments, commercial banks and overseas investors to facilitate an environment where rates could be reduced
Keywords No keywords specified (fix it)
Categories (categorize this paper)
DOI 10.1111/j.1468-5930.2012.00560.x
 Save to my reading list
Follow the author(s)
Edit this record
My bibliography
Export citation
Find it on Scholar
Mark as duplicate
Request removal from index
Revision history
Download options
Our Archive

Upload a copy of this paper     Check publisher's policy     Papers currently archived: 29,820
Through your library
References found in this work BETA

No references found.

Add more references

Citations of this work BETA
The Ethical Crisis in Microfinance.Marek Hudon & Joakim Sandberg - 2013 - Business Ethics Quarterly 23 (4):561-589.
Putting Responsible Finance to Work for Citi Microfinance.Tzu-Kuan Chiu - 2014 - Journal of Business Ethics 119 (2):1-16.

Add more citations

Similar books and articles
Conflicts of Interest? The Ethics of Usury.Martin Lewison - 1999 - Journal of Business Ethics 22 (4):327 - 339.
Usury.Joakim Sandberg - 2013 - In Hugh LaFollette (ed.), The International Encyclopedia of Ethics. Wiley-Blackwell.
Keynes, Uncertainty and Interest Rates.Brian Weatherson - 2002 - Cambridge Journal of Economics 26 (1):47-62.
Gearing Up, Crashing Loud. Should We Punish High-Flyers for Insolvency?Jukka Kilpi - 1996 - Journal of Business Ethics 15 (12):1343 - 1354.
Added to PP index

Total downloads
31 ( #180,688 of 2,210,133 )

Recent downloads (6 months)
2 ( #222,637 of 2,210,133 )

How can I increase my downloads?

Monthly downloads
My notes
Sign in to use this feature