> Posted by Center Staff
For Alex Silva, President of Omtrix and Executive Director of Calmeadow, a transition from industrial engineering and corporate banking to microfinance was natural. In our most recent Microfinance Matters Interview, Silva discusses his unique introduction to microfinance, the commercial approach to microfinance that he was instrumental in developing and much more. Read this intriguing interview to learn more about Silva’s progression into microfinance and some of the many lessons he learned along the way!
The interview, conducted by Lucy Conger, begins:
Conger: You say you weren’t initially motivated to work in microfinance. What finally convinced you?
Silva: Early on, I was worried about interest, and I asked a client what she thought of the rates. She asked the loan officer what the rate was. The loan officer said three percent. The client said three percent per day was high, and then the loan officer clarified that the rate was three percent per month. The client then said it was low! She was thinking a daily rate, while we typically think of annual rates. Ultimately, the client isn’t interested in the interest rate. For them, what’s key is access to the funds. That made an impression on me. And trying to be socially oriented was a constant in my life.
Conger: What were the early risks for ProFund, which began investing in MFIs when they were non-profits?
Silva: NGOs—which at that time were the only ones providing microfinance—were there to help the poor. But they were inefficient. They were run by former Peace Corps volunteers and anthropologists. But despite the inefficiencies of the organizations, some were running profitably. Our belief was that if we could organize them better, introduce some technical assistance, we could improve their performance and make them attractive as a business proposition for commercial investors…
To read more about Silva’s experiences and insights in the microfinance industry, please click here.
Also, be sure to check out the entire Microfinance Matters series and many other resources on our newly redesigned website, www.centerforfinancialinclusion.org.
Have you read?
Broadening Horizons for Microfinance Leaders
Alex Silva on failures in microfinance: ‘With great power comes great responsibility’
Advancing Financial Inclusion: Same Vision with a Different Look