Inner City Press
Global Inner Cities Report - November 22, 2004
The United Nations declared 2005 as the International Year of Microcredit. On November 16, 2004 at
Columbia University, the present and future of microcredit was discussed by a five-person
panel which included two representatives from the U.N., including UNDCF chief technical
advisor Christina Barrineau, and two individuals affiliated with Citigroup. Even beyond
these two explicit Citigroup representatives, the U.N. representatives referred repeatedly
to Citigroup vice chairman (and ex-IMF official) Stanley Fisher. Thus it appears to some that, at least for the U.N.
and the self-defined elite of the microcredit industry, the worlds largest bank is
the leader of banking for the poor. A questioner at the event noted that Citigroup has
been charged with predatory lending to the poor, not only by consumer advocates, but by
the Federal Reserve Board, the Federal Trade Commission, and other governmental agencies.
During the November 16 discussion, Citigroups Robert Annibale stated that
through time, Citigroup might be the originator or booker of the retail loans
made by microfinance institutions. He said that Citigroup might sell
micro-insurance through the microfinance industrys distributions
network, which digs deeper, he said, into the target population.
Mr. Annibale was asked, by Inner City Press' reporter Matthew Lee, to address the
incongruity between the activities of CitiFinancial and its predecessors, which have led
to governmental charges of predatory lending, and Citigroups claimed role in
micro-finance. His response alluded to codes
of conduct and legislative change in various countries, but did not address
Citigroups predatory lending settlements directly.
A representative from Womens World Banking, Nancy Barry, did distinguish
between loans for small business and loans for television sets and the like (and stated
that the latter makes up 90% of the purported micro-finance loans in South Africa). In a discussion following the panel, one wag
speculated that Citigroup might assist microfinance institutions to make loans to prop up
Citis own television and other consumer finance lending. While microfinance certainly has promise for those
in need, its capture by the likes of
is a potentially troubling development, calling out for greater debate and transparency.
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