After completing the final reading assignment of the semester, I was most surprised by the profitability of Vikram Akula's company. Before reading the journal article, I found it hard to believe that a business could profit from extremely small loans made to the poor. What Vikram has accomplished is truly astounding and a testament to the untapped markets that still exist in modern society.
I was most confused by the way in which the author introduced his business idea and model at the beginning of the article. While he mentioned the problems SKS Microfinance experienced in Nizamabad, he failed to clearly explain what was done to resolve the problem there. Could nothing truly be done with the exception of leaving the town?
If I had the opportunity to ask the author two questions I would first ask if SKS Microfinance has ventured to conduct business in other countries with poverty levels similar to those in India? Intuition tells me that there are definitely other countries in which this business model would also be profitable, but there must be a reason the company hasn't entered new territory as of yet. I would also ask what the exact job specifications of the loan officers are. I understand that they make sure that customers are on track in re-paying their loans, but how are they able to enforce this without acting as a loan shark?
Given that I have very little experience with the field of Microfinance I would not say that the author was wrong about anything.
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