In S. Africa, a model bank for Third World, by John Donnelly
Sunday, May 1, 2005
For most of South Africa’s working poor, doing business with a bank has been out of the question. One-month loans carried an average 30 percent interest rate. Many savings accounts lost money every month because of multiple fees.
Now the poor suddenly have new options, including one that some analysts say could be replicated throughout the developing world.
Perhaps the most promising initiative is offered by privately owned Capitec Bank, which opened five years ago as a micro-lending institution and a year ago expanded into savings accounts. It now has 300,000 customers, half of them opening savings accounts.
The bank offers 10 percent interest on some savings accounts, a new debit card in a pilot program with MasterCard that allows poor people to do business without cash, and a one-month loan with a 15 percent interest rate.
Story found here.
Source: The Boston Globe