MANILA, Philippines—The global financial crisis put the squeeze on the microfinance sector in the last four years, resulting in a drop in the flow of foreign donor money that allowed lenders to provide cheap financing to small borrowers. According to Lourdes Pineda, president of Rizal Microbank (a unit of RCBC), the scarcity of these interest-free funds means microfinance institutions have no choice but to professionalize their operations to ensure the availability of cheap credit for borrowers at the "base" of the pyramid. The microfinance industry remains the most viable replacement to informal sources of funds that charge usurious interest rates on ...
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