This article begins by describing attributes of the NGO sector, including its phenomenal growth, its new legitimacy and reputation, and national and regional differences among NGOs. It then discusses the tensions, tradeoffs, trends, and strategies posed by globalization as the political economy in which NGOs operate is changed. It notes that in the global marketplace of altruism, NGOs risk seeing the positive promise of NGO globalization far outweighed by the dangers of commodification of their work. Finally, the author concludes that a return to the roots of altruistic activism may prove the best strategy in response to today's challenges.

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A large number of NGOs are now involved in microfinance and more are making the move towards it; some even converting their finance operations to banks. This paper examines some of the motivations for this change and raises questions about the trade offs involved. The paper suggests that when credit systems air to be financially sustainable there is a strong bias to engage in credit only. The trade-offs involved have consequences not only for the soul of many NGOs (the tension between the imagery of compassion and that of capitalism) but in terms of outreach to the very poor, and in terms of impact and effect on the recipients. Credit-only approaches which adhere to sustainability criteria often miss the very poor. And as for those who are reached by micro loans, without other inputs than credit, many of these borrowers have difficulty making productive use of the loans; the result of lack of absorptive capacity, lack of confidence, lack of knowledge. NGOs who shift into sustainable credit programs may be losing their real competitive advantage in the world of development-their capacity to reach the very poorest and engage in a variety of activities that help people change, but which cannot necessarily be financially supported by the recipient of the assistance.

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