Many necessary programs will never make profits. I think so. Microlending has become a very well established feature of development efforts. What there is debate about is how much microlending has to be supported by other interventions, such as training, market supports, regulatory support, advocacy, infrastructure development, and so forth. And also to what extent it can be focused on the very poor vs. the moderate poor.
People argue about things like appropriate interest rates and how many subsidies it requires.
But there's still no approach that has demonstrated the ability to create employment for so many people so quickly, especially in the developing world. The approach to the policies and strategies used by microlending programs vary, but one that's key in Bornstein's view is geography. There are issues of varying government regulations in the context of taxes, competition, supplier access, and responses to dynamic markets that make the barriers tougher here. The answer remains open to speculation. Richard Taub is the Paul Klapper Professor in the Social Sciences at the University of Chicago and a professor in the Department of Sociology and Human Development.