To analyze the prospects for expanding financial access to the poor, bank professionals assessed 1,438 households in six provinces in Indonesia to judge their creditworthiness. About 40 percent of poor households were judged creditworthy according to the criteria of Indonesia's largest microfinance bank, but fewer than 10 percent had recently borrowed from a microbank or formal lender. Possessing collateral appeared as a minor determinant of creditworthiness, in keeping with microfinance innovations. Although these households were judged able to service loans reliably, most desired small loans. Calculations show that the bank, given its current fee structure and banking practices, would lose money when lending at the scales desired. So, while innovations have helped to extend financial access, it remains difficult to lend in small amounts and cover costs. JEL codes: G21, O16 Microfinance is built on a compelling logic: hundreds of millions of poor and very poor households seek capital to build small businesses, but their lack of collateral restricts access to loans. Innovative "microbanks" meet the demand with more flexible collateral requirements and thus unleash untapped productive power. 1 The narrative, highlighted by the Nobel Peace Prize committee in awarding the 2006 prize to Muhammad Yunus and the Grameen Bank of Bangladesh, has driven the global expansion of microfinance (Counts 2008).

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Rearrangement of the tetrahydro-derivative of the heptacyclotetradecane Binor-S in the gas phase in hydrogen chloride over a chlorinated platinurn-alumina catalyst at 150" or in solution in dichloromethane containing aluminium chloride gives diamantane in high yields. Methods for functionalisation of diamantane have been developed. Chlorination at 0" with aluminium chloride-acetyl chloride yields equal amounts of 1and 4-chlorodiamantane (the so-called zonal and apical derivatives) whereas use of chlorosulphonic acid a t -5" yields mainly the 1 -chloroisomer. Hydrolysis of the chlorides yields the corresponding alcohols, which are separable by chromatography over alumina. The chlorides and alcohols can be equilibrated with aluminium chloride and with concentrated sulphuric acid, respectively. Oxidation of diamantane with 96% sulphuric acid at 75" yields diamantanone, 9-hydroxydiamantan-3-one, and diamantane-4.9-diol. Treatment of diamantan-3-01 with 70% sulphuric acid yields a mixture of mono-01s. 9-hydroxydiamantan-3-one, diamantane-3.9-dio1, and diamantane-4,g-diol.A SUBSTANTIAL improvement in the technology of adamantane production was recently reported.2 In this new approach conventional batch techniques are replaced by a gas-phase flow system in which the hydrocarbon precursor in a stream of hydrogen chloride is passed over a chlorinated platinum-alumina catalyst at 168". The advantages of the method lie in the greatly improved yields of adamantane and in the almost total elimination of destructive side reactions. We have now achieved similar improvements in the efficiency of rearrangements leading to diamantane (1) (formerly called congressane), the second member of the diamondoid hydrocarbon homologous series.Schleyer and his co-workers were the first to discover that diamantane could be synthesised from the [2 + 21 norbornene photodimer (2) by rearrangement with an aluminium bromide ' sludge ' catalyst in yields of l-lOyo depending on which stereoisomer of the starting material was employed. Disproportionation and fragmentation reactions predominate with these dimers, no doubt because of the presence of the highly labile cyclobutane ring.l Preliminary report, I).

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After the 1997 East Asian crisis, central banks throughout the region tried to reduce the risk of future bank failures by promulgating regulatory reforms. The results in Indonesia have been to concentrate rather than mitigate banking risks, and to decrease the access of low-income households and enterprises to formal financial services, especially in rural areas. The most severe casualties of the 'reforms' have been local government-owned micro finance institutions. In the provinces where these institutions have functioned best, they have addressed a market failure by extending coverage to areas not served by conventional financial institutions. Understanding the past performance and potential for replication of these success stories continues to be important because of the substantial gaps that remain in the access of rural Indonesian households and micro enterprises to fi nancial services.