This paper presents a model of the complete microcredit financing chain investor - MIV - MFI - micro-borrower, in which social-minded MIVs provide funds only to those MFIs which do not exploit their bargaining power towards micro-borrowers. The MFIs with the highest bargaining power do not use...

Microborrowers may take usurious loans to repay a loan taken from a microfinance institution because of having neglected the time inconsistency of optimal plans or having discounted future payoffs too strongly from the ex-post perspective. Microfinance programs should strive at preventing such...