A pedagogy of groupBut critics are not lacking

In October, the models top which gladdened their mechanical smiles the pages of newspapers and TV in the parades of haute couture in Paris news faced unexpected competition. Women dressed in colorful saris, often prematurely wrinkled and wisely sitting in a circle on the ground of villages of the end of the world, stole them the features. The Bangladeshi Muhammad Yunus had with his Grameen Bank to be awarded the Nobel Prize in peace, 2006, throwing a surprising blow of projector on any people not accustomed to so much interest. Microcredit, invented thirty years ago by the "banker of the poor", became a superstar at the same time. This system then appeared as the key to development and the Nobel Prize as a much more effective red carpet in media terms that the "year of microcredit" enacted in 2005 by the United Nations.

Simple, both liberal and based on the reduction of poverty, the idea of making money by releasing the entrepreneurial potential of the poor please right as to the left. That Yunus dream to build in a new human right has no fact surprise around the world in the wake of the pioneers, the Grameen Bank and Acción International. But the reality is often more complex. Already, at the beginning of the year, the World Bank, whose President Paul Wolfowitz is strong supporter of microfinance, put stop to this excitement. It is not the only one. "Multidimensional" phenomenon, poverty represents "much more than a lack of money," and out depends on a slow and irregular process remembered. Microcredit is therefore not a "magic formula", but rather one "strategy among others", such as the merit of conferring an economic and social role both in the poor and women, and to promote the stability of societies.

A fast growing sector

The global success of the democratization of capital formula, given 'winner-winner' for borrowers to lenders, is patent. There are some 10,000 businesses of microcredit and microfinance in the world, allowing the day to 130 million poor households to borrow 30 billion, said Jacques Attali, President of PlaNet Finance International Solidarity Organization. And the Summit of microcredit, in Halifax, the last month, has set a goal to bring this figure to 175 million by 2015, which would affect nearly 1 billion of the 3 billion do not have access to the traditional banking system. The main agencies of development of the countries of the OECD there bring their support: EUR 800 million per year, plus 500 million from the International Finance Corporation, branch "deprived" of the World Bank, said Elizabeth Littlefield, CEO of CGAP, the Advisory Council for assistance to the poor, which brings together 33 development agencies.

Extremely fragmented, this activity is in no less turned at sight of eye. Needed to enhance the short cycle of loans of longer duration and guarantees for the future prospects. Thus moved from NGOs distributing small credits to microfinance, a business sector offering a wide range of services (savings, insurance, transfers of funds). Yunus himself fun of this evolution, where small microfinance organizations are transformed in banks and where, through their subsidiaries, giants like ABN AMRO, Standard Chartered, HSBC and Citigroup are distributing tiny credits. Besides mobile telephone companies, which become operators key in the transfer of money in Africa or elsewhere. "Microfinance began to resemble a standard financial sector," said the Nobel Prize. While the Stanford Business School students working on its effectiveness, it is already more "niche". The evidence: authorities have put in place to regulate this market fairly anarchic here, and this even in Bangladesh in February.

Remains that these institutions evolve in an often fuzzy environment: on the one hand, borrowers from most of the time of the informal sector; on the other, of States which do not shine by their good governance or want to deal, in particular the interest rate cap.

But when it is viable, this industry knows to be efficient. Syed Hashemi, the CGAP, even points out that "it is one of the most dynamic in the world", recalling that the best microfinance institutions increased by 15 per year over the past five years, two times faster than the best commercial banks. Their secret: loans are Lilliputians ($ 350 in world average), clients often dispersed in rural areas, the expensive management costs, but interest rates very high (between 20 and 80) and the number of minimal defaults: "Person is not working as much as those who are fighting to satisfy their basic needs", professes "banker of the poor". It is also true that the poor, often illiterate, spin sweet to educated and zealous officers... Paradox: it is the poor who are the most profitable financial institutions.

A shock management tool

Without play on words, is the point of view "micro" (economic) that these credits include the benefits. First of all, for the poor with access to formal financial services, is "it or nothing"... and thus "all", if one excepts usurers that abound in the developing world and offer rates likely to reach 50 per month, or even 10 per day! Then, there is no shortage of a variety of examples of professional success, often limited to the sole beneficiary of the loan or to his family: purchase of land, developing a small business or a workshop such as carpentry, shoemaking..., creation of a public "telephone booth" with the cell phone. Or even the case of a producer of bananas in Benin plantain chips which entered in the formal economy, employs 19 people and now deals with conventional banks. But, in the opinion

the vast majority of observers, this access to credit in general causes less a bond business and employment and a reduction of the vulnerability of the family. With a restriction: never microcredit affects the poorest of the poor, for which appropriate social programs in due form.

PlaNet Finance has made the Morocco a difficult exercise of measuring the direct effects of microcredit borrowers homes. Its Director General, Sébastien Duquet, explains: "It is an additional income of 5 to 10 per year, which is not a revolution, but has an impact on the way of life very hard." The increase in and diversification of income to improve food and create margins of manoeuvre for tuition, health, the purchase of durable goods or habitat improvement. But this increase of resources would be observed that in a case on four, according to the Institut de recherche pour le développement (IRD). It helps to cope with the vagaries of a life where it is used to move from one crisis to another (climate, health, policy...). In this unstable world, microcredit has emerged as an "essential shock management tool", and even to take risks, says Sébastien Boyé, co-author with Jérémy Hajdenberg and Christine Poursat, "Guide of microfinance". It has also proved very effective in the reconstruction of Sri Lanka after the tsunami in December 2004.

Initially targeted at women, that empowers the future of their children, microcredit has especially become for them "a point of entry in the public sphere, from which a significant social change can be initiated", indicates in an Indian NGO. They become so "dynamic catalysts of development", considers the UN Programme for development (UNDP). Many are now women who sit on India in the equivalent of our municipal councils, or that challenge implied the male primacy in Muslim societies, as in Bangladesh. The French Development Agency (AFD), the number of battered women was decreased as a result. An emancipation which is felt in many areas, up to contraception.

Poverty reduction

At the macroeconomic level, the record is less clear. One can doubt: microcredits are 90 informal economy whose evolution is hard to measure. Of course, imagine easily that improving the lives of 21 million homes change somewhat the landscape in Bangladesh, a saturated country of microcredit: "tide raise all boats", notes the CGAP. The Bangladesh Institute of Development Studies believes that poverty fell by 1 percentage for a decade and, in his view point, microcredit "has played a major role" in this change. "We know that over there is credit, there is more growth," said Martha Stein-Sochas, Director of financial services of the AFD. "It is often said that microcredit is a debt instrument." False: it is creator of wealth! ", protested his side the French Maria Nowak, President of Adie (Association for the right to economic initiative).

ALCO, it falls within the direct effects: a bankarisation of proximity that can multiply by ten the rate of bankarisation classic, and the emergence of new competition in the small trade. And indirect effects: the change in farm structures with a lesser remedy to rent or sharecropping, the strengthening of the positions of rural workers, become more independent, wage bargaining. Very fluid, the dissemination of microcredit seems in any case a guarantee of efficiency: "It is far from heavy sectoral plans of Governments with their problems of governance." "Microfinance through private operators, and its effectiveness is immediate," said Marie-France the Hériteau, head of microfinance to the AFD project.

A pedagogy of group

But critics are not lacking. The first is that Governments and even large international organizations would be in this appeal to the private sector the way to discard, microcredit causing damage in conventional social programs: on leave while Paul ragged... when Pierre would dress on the market. Result: many people who want to debunk the myth of the "poor contractor." "It gets a little credit, but has no expertise, network, or access to information," said Isabelle Guérin, Institute of development research. "Worse, access to the market is very limited, lack of competitiveness, either due to lack of purchasing power on the spot.". "There are few examples of expandable opportunities as directed towards export, such as the cotton sector in Mali, or coupling micro-cooperatives of crafts", she adds. ALCO concedes himself that microcredit does not lead to "strategic investments". Most often used for consumption, leading to the best in "odd" and the self-employment projects that it finances must be accompanied by development, health and training programs for meaning, considers the BRAC, the largest NGO in Bangladesh, in agreement on this point with the international labour office. Like number of "developers", Sébastien Boyé adds to this list of political and economic reforms, but also more democracy, infrastructure, governance. Otherwise, the microfinance in developing world boils down to a simple "survival strategy".

But there are a beautiful unanimity. Even tenuous at first, the impact of microcredit is proving essential arrival on education, social culture and the position of women in society. Real education group, in what he put both on own efforts of the individual and on mutual trust, it is in the unquantifiable, appeasement of societies wounded by their daily lives, that he would succeed almost better. The Nobel Committee does there not erred. In culminating Muhammad Yunus and the Grameen Bank, he was further rewarded a 'lever' of peace as a miracle of development tool.