Two leaders of protests against microfinance institutions in Morocco have been sentenced to one year of prison each. In addition, they are to pay fines amounting to nearly 5,000 US Dollars, a judge ruled in Ouarzazate on 11 February. The defence complained about a number of irregularities during the trial.
Amina Morad and Benacer Ismaïni, activists of the Association for Defending Victims of microcredit in Ouarzazate, were given ten days to submit appeals to the court. The two activists had earlier been found not guilty in a previous trial, but were taken to court again by INMAA, a microfinance association linked to PlaNet Finance.
The ongoing protests in the country, whose microfinance sector has still not recovered from a crisis in 2008, might indicate that the Moroccan microfinance industry has trouble containing its overindebtedness problem. Surprisingly, the size of the average outstanding loan to by microfinance institutions in Morocco has risen by 38 percent since the crisis, although more than five percent of borrowers are over 30 days overdue. Before the crisis began, the average borrower owed US$ 543, now they owe US$752.
Indicators of instability in Moroccan microfinance (data: MIX)