If you ask me a particular case and ask whether the reason quoted as “suicide ” is true, I would say, it seriously needs a detailed investigation.
Let me tell you why it could not be a reason:
1. Politics is completely emotional. If someone, sometime has died because of the pressure of microfinance, there is every incentive for the politicians to gain market and popularity by making it more emotional and try to rope in the other cases also to the same spectrum.
2. There are also indications from Govt to waiver the loans. Hence, there is every incentive for the borrowers to ensure that their loans are waived. It is highly possible only when they are able to prove that the microfinance is making their life miserable.
Why it could be a reason?
1. Investors see lot of profits in the sector. Hence, huge amounts of money are dumped in the sector which results in multi lenders to a particular borrower. Get loan from one source and repay other. Develop internal competition and also the borrowers lose the interest to repay.
2. At the strategy level, one officer lends (based upon his target) and others deals with repayment (based on his target). The one who plans for lending think less about the repayment because of the huge inflow of fund in the sector.
3. The “bread and butter” of the field level staff are highly dependent on the amount he is able to recover from the borrowers. He obviously will make the life of the borowers miserable for his own self-benefits.
4. The microfinance sector is no-more a development strategy. The microfinance sector here is unable to evolve a model similar to that of Bangladesh as the market economy reacted here in a more different form.
