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Prospective Innovation at Ethical Banking and Finance
Future pathways for ethical banking, new changes in the post-crisis period: A case for micro financing to the poor
Rengarajan Varadarajan
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India
Abstract
The eventualities of the past sordid events in banking industry like financial crisis right from Wall street to micro finance (MF) platform indicate the presence of unethical competitive financial market, profit motivation and moral deterioration among the actors. Adding fuel to fire, forced technology intrusion in the name of branchless banking and financial inclusion, particularly in the unbanked poor client side also would likely widen the inequality gap or tech divide among the people. Ethical dimension in micro financing in particular has not been justifiably delved in earlier studies. In this regard a paradigm shift is inevitable for the future. As against the premise, an attempt has been made in this paper a) to perceive critically the intricate nexus between ethics and economics and its influence over human behavior in their business activities more particularly in micro finance banking b) to prudently look at individual value system through the lens of Amartya Sen as it basically influences for shaping ethical behavior of humankind c) to probe the causative factors for the recent micro financial crisis leading to many unintentional consequences and d) to suggest future pathways for ethical banking and responsible financing to the poor in terms of a covenant ‘Ten commandments for micro finance community’ to be practiced at grass root level.
References
Amartya Sen, 1998 ‘On ethics and economics’ Oxford India paper backs pp. 12-13
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Rengarajan, V. 2013 Microfinance Principles and approaches : Ten commandments for responsible financing to the poor”. Notion Press.com. pp. 72-73
Rengarajan, V. 2013 Microfinance Principles and approaches : Ten commandments for responsible financing to the poor”. Notion Press.com. pp. 193-194
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Key words
Economic-ethics nexus, Microfinance industry, Amartya Sen, ethical banking, unethical financial practices, wealth and greed, Ten commandments
Citation
V.Rengarajan (2013), Future pathways for ethical banking, new changes in the post-crisis period: A case for micro financing to the poor, in Leire San-Jose, Jose Luis Retolaza (eds.) Prospective Innovation at Ethical Banking and Finance (Studies in Philosophy, Law and Economics), - Sumy: Vinnychenko M.D., pp.163-183. Available at http://taadler.com/a27