Microcredit is defined as very small loans to very low-income entrepreneurs, has attracted wide attention as a potentially effective means to promote economic development in poor countries. This case focuses on one of the largest and most successful such microlenders, Compartamos in Mexico ("we share") organization, and raises the question of the most effective business model and scale microcredit organizations. Specifically, in the case tells the story of how Compartamos, which found great success by making small loans in the villages and rural areas, was lucky when he sought to expand in Mexico. series of failures - higher default rates, personnel problems, and suddenly the competition and regulatory issues - implicitly raises the question, Compartamos and microcredit organizations of this type, which has historically relied on peer pressure group to ensure repayment otherwise unsecured small business start-ups, can be expanded and adapted to the urban environment. HKS Case Number 1761.0 "Hide
by Jonathan Schlefer, Guy Stuart 21 pages. Publication Date: June 1, 2004. Prod. #: HKS087-PDF-ENG
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