Ending the Microfinance Crisis in Morocco : Acting Early, Acting Right
In the fall of 2008, the Moroccan microfinance sector underwent what in economics is referred to as a Minsky moment, the sudden realization that the market has overshot and that the good times are coming to an end. In this particular case, the Mins...
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| Format: | Working Paper |
| Language: | English en_US |
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International Finance Corporation, Washington, DC
2017
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| Online Access: | http://documents.worldbank.org/curated/en/852051486371609376/Ending-the-microfinance-crisis-in-Morocco-acting-early-acting-right http://hdl.handle.net/10986/26054 |
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okr-10986-260542021-04-23T14:04:33Z Ending the Microfinance Crisis in Morocco : Acting Early, Acting Right International Finance Corporation financial crisis high-risk loans financial supervision liquidity microfinance In the fall of 2008, the Moroccan microfinance sector underwent what in economics is referred to as a Minsky moment, the sudden realization that the market has overshot and that the good times are coming to an end. In this particular case, the Minsky moment was a specific event – the private circulation of an IFC study that found extensive problems with the portfolios of the country’s four largest Microfinance Institutions (MFIs), and one in particular – Zakoura. This study picks up from Morocco’s Minsky moment. The MFIs at the time were beginning to see unequivocal signs that the market was shifting. The lead-up to this moment has been well documented: the reckless pursuit of growth, fed by an equally reckless influx of funding, both foreign and domestic, the high rate of multiple lending, poor lending standards and equally poor back-office and management information systems (MIS), and poor governance – all have been noted as causes of the crisis. While this study is meant to cover the full Moroccan microfinance sector, due to constraints of time and availability of data, its primary focus is on the three largest MFIs in Morocco. This report is organized into three key sections: 1) a review of the main drivers and factors evident during the course of the Moroccan microfinance crisis (2008-2011); 2) an examination of the key responses taken by the MFIs during the course of the crisis; and 3) a review of government actions and other market-level changes that affected the nature and trajectory of the crisis. The authors close with a look at the future prospects for microfinance in Morocco. 2017-02-13T22:55:37Z 2017-02-13T22:55:37Z 2014-10-01 Working Paper http://documents.worldbank.org/curated/en/852051486371609376/Ending-the-microfinance-crisis-in-Morocco-acting-early-acting-right http://hdl.handle.net/10986/26054 English en_US CC BY-NC-ND 3.0 IGO http://creativecommons.org/licenses/by-nc-nd/3.0/igo International Finance Corporation International Finance Corporation, Washington, DC Publications & Research Publications & Research :: Working Paper Middle East and North Africa Morocco |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English en_US |
| topic |
financial crisis high-risk loans financial supervision liquidity microfinance |
| spellingShingle |
financial crisis high-risk loans financial supervision liquidity microfinance International Finance Corporation Ending the Microfinance Crisis in Morocco : Acting Early, Acting Right |
| geographic_facet |
Middle East and North Africa Morocco |
| description |
In the fall of 2008, the Moroccan
microfinance sector underwent what in economics is referred
to as a Minsky moment, the sudden realization that the
market has overshot and that the good times are coming to an
end. In this particular case, the Minsky moment was a
specific event – the private circulation of an IFC study
that found extensive problems with the portfolios of the
country’s four largest Microfinance Institutions (MFIs), and
one in particular – Zakoura. This study picks up from
Morocco’s Minsky moment. The MFIs at the time were beginning
to see unequivocal signs that the market was shifting. The
lead-up to this moment has been well documented: the
reckless pursuit of growth, fed by an equally reckless
influx of funding, both foreign and domestic, the high rate
of multiple lending, poor lending standards and equally poor
back-office and management information systems (MIS), and
poor governance – all have been noted as causes of the
crisis. While this study is meant to cover the full Moroccan
microfinance sector, due to constraints of time and
availability of data, its primary focus is on the three
largest MFIs in Morocco. This report is organized into three
key sections: 1) a review of the main drivers and factors
evident during the course of the Moroccan microfinance
crisis (2008-2011); 2) an examination of the key responses
taken by the MFIs during the course of the crisis; and 3) a
review of government actions and other market-level changes
that affected the nature and trajectory of the crisis. The
authors close with a look at the future prospects for
microfinance in Morocco. |
| format |
Working Paper |
| author |
International Finance Corporation |
| author_facet |
International Finance Corporation |
| author_sort |
International Finance Corporation |
| title |
Ending the Microfinance Crisis in Morocco : Acting Early, Acting Right |
| title_short |
Ending the Microfinance Crisis in Morocco : Acting Early, Acting Right |
| title_full |
Ending the Microfinance Crisis in Morocco : Acting Early, Acting Right |
| title_fullStr |
Ending the Microfinance Crisis in Morocco : Acting Early, Acting Right |
| title_full_unstemmed |
Ending the Microfinance Crisis in Morocco : Acting Early, Acting Right |
| title_sort |
ending the microfinance crisis in morocco : acting early, acting right |
| publisher |
International Finance Corporation, Washington, DC |
| publishDate |
2017 |
| url |
http://documents.worldbank.org/curated/en/852051486371609376/Ending-the-microfinance-crisis-in-Morocco-acting-early-acting-right http://hdl.handle.net/10986/26054 |
| _version_ |
1764460828338159616 |