![lend more to small firms mit professor lend more to small firms mit professor](https://i1.tribune.com.pk/wp-content/uploads/2011/12/310647-AbhijitBanerjeePHOTOMIT-1324589672.jpg)
Delivering a lecture on ‘Micro-Credit and Financing of Small Business’, Banerjee said that financial access is more important for helping the poor manage poverty better, than making them rich.
The lecture, organised by the State Bank of Pakistan, was the 18th such event held as a part of Zahid Husain Memorial Lecture series instituted in 1973 in the name of its first Governor, Mr. Zahid Husain.
“Micro-credit has caused reduction in interest rates by 30% to 60% and increased the level of savings among the poor, thereby leading to the reduction in poverty,” observed Banerjee who has published more than 60 papers in the world’s leading economic journals
Professor Banerjee laid emphasis on the significance of financial access to the poor. He argued that big banks disburse loans on the basis of collateral involving a plethora of formalities which, on the one hand, depresses the volume of credit available to the poor and, on the other, limits the number of borrowers.
Published in The Express Tribune, December 23rd, 2011.
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PTI can give stability needed for investment and business
But first we need POLITICAL and ECONOMIC stability. Businesses cannot create GROWTH if they are not provided with a suitable environment. The "Micro-Finance" model, which is implied here, would only work if the Entrepreneurs are provided with a sound Eco system like in Bangladesh. Otherwise, there would be too many non-performing loans ready to be written off.