An Interview with Yevgen Berezovsky, a Venture Capitalist and Serial IT Entrepreneur
Question: Yevgen, to put it simply, why is microcredit in Asia such an important issue today?
Answer: Because Asia is a region where two realities coexist side by side. On the one hand, we see tech hubs, digital banks, fast payments, developed marketplaces, and millions of people who already live in an almost entirely cashless economy. On the other hand, in that same Asia, a huge number of people still work in small businesses, family-run shops, agriculture, and local services, and do not always have access to traditional bank loans.
Microcredit bridges this very gap. For a small business owner, a market vendor, a farmer, or the owner of a small café or workshop, even a small amount can be a catalyst for growth. It’s not necessarily a “survival” loan. More and more often, it’s a loan for growth: to purchase equipment, expand the product range, pay for seasonal purchases, hire an assistant, switch to digital payments, or take the first steps into e-commerce.
Asia is interesting in that microcredit there has long since moved beyond the realm of charity. It is now a full-fledged part of the financial infrastructure. Of course, the level of maturity varies from country to country. But the overall trend is clear: access to small amounts of capital is becoming not a social option, but an economic tool.
Question: Why is Vietnam so often cited as an example?
Answer: Vietnam is a very illustrative case. It is a country with a strong entrepreneurial culture, a large number of small businesses, a significant role for the family in the economy, and active development of digital financial services. At the same time, Vietnam did not attempt to build microfinance solely as a “quick money” model. Instead, a broader system gradually took shape there: financial inclusion, access to basic banking products, rural development, support for women entrepreneurs, regulation of microfinance organizations, and the adoption of digital tools.
It is important to understand that the Vietnamese experience is not perfect and cannot serve as a one-size-fits-all solution. But it is valuable in that it shows how microcredit can work in conjunction with government programs, the banking sector, local communities, and digital platforms. It is not a single tool, but an ecosystem.
This is particularly relevant for many Asian markets. If you simply issue a loan to someone without follow-up, without assessing their ability to repay, without financial literacy, and without clear regulations, you risk creating a debt burden problem. But if the loan is integrated into a sound financial system, it becomes a mechanism for growth.
Question: What distinguishes the Asian microcredit model from the Western one?
Answer: The main difference lies in scale and social structure. In Asia, microcredit is often linked not only to the individual borrower but also to the family, the village, professional communities, women’s groups, and local cooperatives. Financial behavior here is largely based on trust, reputation, and ongoing relationships.
In the Western model, a loan is more often viewed as an individual financial product. In Asia, it often becomes part of a broader social system. For example, if a woman takes out a microloan for home-based production or trade, it affects not only her personal income but also her children’s education, family stability, relatives’ employment, and the development of the local market.
Another difference is the pace of digitalization. In some Asian countries, people may not have had a long history of interacting with traditional banks, but they very quickly transitioned to mobile payments, e-wallets, and digital services. This has created a unique situation: the financial system has, in a sense, “skipped” several stages of development.
Question: What lessons can we learn specifically from Vietnam’s experience?
Answer: I would highlight a few lessons.
First, microcredit should be part of a financial inclusion strategy. Not a standalone product that exists on its own, but part of a system where people gradually gain access to accounts, payments, savings, insurance, and credit history.
Second, small loans must be linked to the real economy. Vietnam’s strength lies in the fact that there are many microentrepreneurs who borrow money not for abstract purposes, but for specific business needs: goods, raw materials, equipment, and seasonal purchases. When a loan is tied to a clear cash flow, the risks are lower.
Third, local institutions of trust play a major role. In some cases, these are women’s organizations, local associations, cooperatives, and partner organizations. They help provide a better understanding of the client, their reputation, and their actual financial situation. This is critically important for microfinance, since the client may not have a traditional credit history.
Fourth, digitalization should support—not replace—common sense. Yes, credit scoring, mobile apps, online payments, and automation significantly reduce costs. But if the system starts issuing loans too aggressively, without understanding the client, that’s no longer progress—it’s a risk.
Question: Can we say that microcredit is, first and foremost, a social tool?
Answer: People used to say that more often. Today, I would put it differently: microcredit is a financial tool with a strong social impact. When used correctly, it helps people break out of financial isolation, grow their businesses, develop payment discipline, and build a credit history.
But at the same time, we shouldn’t romanticize microloans. A small loan in and of itself does not make a person richer. It can help if the borrower has a clear goal, a realistic income, a reasonable interest rate, transparent terms, and access to information. Without these, a microloan can become a trap.
Therefore, a professional approach is not about issuing as many loans as possible, but about providing the right product to the right client at the right time. It sounds simple, but in practice, this is precisely where the line is drawn between sustainable microfinance and a risky model.
Question: Which categories of clients most often benefit from microcredit?
Answer: In the Asian context, I would highlight three groups.
The first is microentrepreneurs. These are people who are already doing something: trading, manufacturing, providing services, growing crops, or working in the food, repair, logistics, or household services sectors. For them, even a small amount of working capital can have a rapid impact.
The second group consists of women entrepreneurs. In Vietnam and many other Asian countries, women play a huge role in family businesses, trade, agriculture, and the local economy. For them, access to financing often means not just an increase in income, but greater autonomy in decision-making.
Third are residents of rural and semi-urban areas. Traditional banks do not always operate effectively with small amounts and remote clients. For a bank, this is expensive, complicated, and not always profitable. Microfinance institutions, especially when partnered with digital services, can serve these clients more effectively.
Question: What is the main risk of microcredit in Asia?
Answer: The main risk is excessive debt burden. When the market is growing rapidly, there’s always a temptation to lend more, faster, and at higher costs. This is especially true when lending goes digital: a borrower can receive funds in a matter of minutes, and a lender can scale up lending without deep human interaction.
But financial accessibility should not turn into financial pressure. Responsible microcredit requires transparent terms, an assessment of repayment capacity, clear communication, interest rate caps, and proper regulation. The customer must understand how much they are borrowing, how much they will repay, what penalties apply, and what will happen in the event of a late payment.
There is another risk—using the loan not for development but to pay off old debts. This is a dangerous sign. If a person takes out a new microloan to pay off a previous one, the system is already failing. Therefore, a mature market must monitor not only the number of loans issued but also the quality of the portfolio, the delinquency rate, repeat borrowing, and the actual economic impact on the client.
Question: How have digital technologies changed microcredit?
Answer: Radically. Previously, microfinance was very “hands-on”: field staff, paper applications, face-to-face meetings, borrower groups, and on-site verification. This model had its advantages—it was more human-centered. But it was expensive and slow.
Digital technologies make it possible to reduce the cost of serving clients. Mobile apps, electronic identification, digital payments, automated scoring, and transaction analysis—all of this makes microcredit faster and more accessible. Especially in countries where the population actively uses smartphones.
But I always emphasize: technology is a tool, not a guarantee of quality. An algorithm can help assess risk, but it shouldn’t reduce a person to a set of numbers. The best models of the future, in my opinion, will be hybrid: digital speed combined with human understanding of the local context.
Question: What can businesses learn from the Vietnamese experience?
Answer: For businesses, the main takeaway is this: microcredit works sustainably where it is embedded in the client’s real needs. You can’t simply copy a product from one country to another. You need to understand the payment culture, income structure, business seasonality, level of digital literacy, trust in financial institutions, and the role of family and local communities.
Vietnam shows that microfinance can be more than just a “payday loan”—it can serve as the infrastructure for small business growth. That’s a fundamental difference. If a company wants to operate in the Asian market, it needs to look not only at margins but also at the long-term quality of its customer base.
A good client in microfinance is not the one who pays the highest interest rate. A good client is one who grows alongside the financial institution: they start with a small loan, then use payment services, savings accounts, and insurance, and eventually, perhaps, transition to a banking product for small businesses. This is a normal trajectory of financial maturity.
Question: How important is the government’s role in this process?
Answer: Very important. The government should not replace the market, but it must set the rules. This is particularly critical in microfinance, because clients are often more vulnerable than those in the traditional banking sector. It is harder for them to assess the terms, harder to negotiate with lenders, and harder to defend their rights.
That is why licensing, transparency requirements, oversight of unscrupulous practices, the promotion of financial literacy, and infrastructure support are necessary. Vietnam is interesting in that financial inclusion is viewed there as part of the national agenda. It is not just a matter for banks, but a matter of economic development.
At the same time, regulation must be sensible. If it is too strict, it will become unprofitable for microfinance organizations to work with small clients. If it is too lenient, the market may resort to predatory practices. It’s a very delicate balance.
Question: How is microcredit related to the development of small and medium-sized businesses?
Answer: Directly. Often, an entrepreneur doesn’t immediately become a small or medium-sized business. They start with a microbusiness: a single location, a single product, a single service, or a family-run operation. At this stage, they don’t need a large bank loan. They need a small, quick, and straightforward source of funding.
If this resource helps increase revenue, the entrepreneur moves to the next level. They begin keeping records, working with suppliers, making payments through digital channels, and building a transaction history. Over time, they become a more transparent client for the bank.
In this sense, microcredit is the gateway to the formal economy. It helps people transition from the informal economy to a more transparent business model. This is also beneficial for the state: employment rises, the tax base expands, and the domestic market develops.
Question: Does Asian microcredit have a future on an international scale?
Answer: Yes, and I think Asia will be one of the key regions where new microfinance models will emerge. The reason is simple: there is simultaneously high demand, high entrepreneurial activity, and rapid digitalization.
The future will most likely belong not to traditional microfinance organizations in their old form, but to ecosystems. For example, an entrepreneur sells goods through a marketplace, accepts digital payments, tracks revenue in an app, receives a financing offer based on actual sales, then insures their goods or health, saves money, and gradually expands their business. This is no longer just a loan. It’s a financial platform built around small businesses.
But let me repeat: strong technology must go hand in hand with responsibility. Otherwise, you can quickly grow your portfolio but lose the market’s trust. In microfinance, trust is the most important asset.
Question: Why is it important for companies to study the Vietnamese experience?
Answer: Because Vietnam provides a practical example of how to combine growth, regulation, and social benefit. It’s important to view microcredit not only as a financial product but also as a model for entering rapidly growing markets.
Such case studies are worth examining to understand where real value is created. It’s not just about issuing loans, but about creating financial solutions that help clients grow. This could include small business lending, partnerships with local operators, digital payments, analytics, products for entrepreneurs, working with women, rural regions, and new retail formats.
The Vietnamese experience shows that if a company knows how to adapt to the local market, respects the regulatory environment, and builds long-term relationships with clients, microfinance can be a sustainable business—not a get-rich-quick scheme, but a truly sustainable model.
Question: How do you see microcredit developing in Asia in the coming years?
Answer: I see three key areas.
First—further digitalization. Application processing, identification, credit scoring, payments, and customer service will increasingly shift to mobile channels. Speed and simplicity will be important to customers.
Second is the shift from individual loans to a comprehensive financial profile of the customer. Companies will look not only at the application but also at the customer’s behavior: sales, payments, seasonality, repeat transactions, and income stability. This will allow for a more accurate assessment of risks.
Third, increased regulation. Markets already understand that financial inclusion must be safe. Therefore, there will be greater focus on customer protection, transparency of terms, curbing unscrupulous practices, and portfolio quality control.
The players who succeed will be those who can combine scaling with responsibility. In microcredit, you cannot build a long-term business that goes against the client’s interests. You might make a profit once, but you cannot build a reputation that way.
Question: What is the main conclusion you would draw from the entire Vietnamese experience?
Answer: The main conclusion is that microcredit becomes a powerful tool only when it helps people move forward—not just to cover an immediate cash shortfall, but to generate income, grow a business, and become part of the financial system.
Vietnam has shown that microfinance can be a component of national development if it is linked to financial inclusion, digitalization, support for small businesses, and smart regulation. This is particularly important for Asia, because millions of people here have entrepreneurial drive but do not always have access to capital.
I would put it this way: the future of microcredit lies not in the size of the loan, but in the quality of the relationship between the client and the financial system. If this relationship is honest, transparent, and long-term, microcredit becomes not a debt burden, but the first step toward economic growth.
