Why are of Micro credit interest rates so high?

The nature of micro credit is such that interest rates need to be high to return the cost of the loan.
"There are three kinds of costs the MFI has to cover when it makes micro loans. The first two, the cost of the money that it lends and the cost of loan defaults, are proportional to the amount lent. For instance, if the cost paid by the MFI for the money it lends is 10%, and it experiences defaults of 1% of the amount lent, then these two costs will total $11 for a loan of $100, and $55 for a loan of $500. An interest rate of 11% of the loan amount thus covers both these costs for either loan.