Microcredit and Women’s Empowerment:
A Case Study of Bangladesh
by Aminul Faraizi, Taskinur Rahman, and Jim McAllister
Microcredit programmes have often been portrayed in the international development literature as the solution to the problem of global poverty and the way to empower marginalised groups. Its proponents have been heralded as the saviours of the developing world – Muhammad Yunus, the founder of Grameen Bank, is seen by many as the social entrepreneur who proved that the poorest of the poor are bankable and credit worthy. Microcredit and Women’s Empowerment: A Case Study of Bangladesh provides an academic critique of microcredit programmes in general, and those implemented by the Grameen Bank and the Bangladesh Rural Advancement Committee (BRAC) in Bangladesh, in particular.
The book consists of six chapters. In Chapter One, the authors address the research problem; in Chapter Two, they discuss the theoretical framework of the study, and reveal the underlying power relationship at work in development debates; in Chapter Three, they review microcredit policies as developed by the Grameen Bank and BRAC in Bangladesh; in Chapter Four, they review how the microcredit and empowerment project is understood by the staff of the two non-government organnisations (NGOs); in Chapter Five, they discuss how microcredit beneficiaries are affected by the programmes in two Bangladeshi villages; and finally, in Chapter Six, they evaluate the effectiveness of the microcredit programme for the empowerment of women, based on their findings in the two villages.
The main objective of this book is to review how microcredit and empowerment projects are conceptualised, both theoretically and empirically (p. 26). The authors argue that BRAC and the Grameen Bank construct poor people and poverty as categories within a problem, thus rendering the poor ‘objects of empowerment’ and providing a justification for intervention in their lives (p. 26). In these theoretical arguments Microcredit and Women’s Empowerment: A Case Study of Bangladesh is commendable. However, the book’s theoretical approach is also its downfall. Originally a PhD thesis by Takinur Rahman, it was thus conceived of as an academic contribution to the field, and uses the theory and language appropriate to such a work. As such, it is more suitable for an academic readership than for those working as development practitioners. The book’s language and assertions tend to be ideological, and drawn from a Marxist perspective, and is peppered throughout with accusations of NGOs and INGOs (international NGOs) acting as both promoters of capitalism (through their espousal and implementation of microcredit programmes) and agents whose aim is to undermine governments in less-developed countries.
Claiming that well-publicised microcredit success stories are blown out of proportion, the book’s main arguments are twofold: firstly, that microcredit does not in fact empower women – rather, it might actually be a tool to subjugate and discipline them – and secondly, microcredit programmes can be seen as marking the detrimental entry of capitalism into the world of the poorest of the poor. The authors use the two case studies to prove their point.
As evidence that the successes of microcredit have been vastly exaggerated, the authors argue that the impact and results on the situation of women and families of increased levels of education and/or better income and better marketing of products might not be as a result of microcredit programmes, but due instead to the role of other oppressive institutions such as traditional money lending, and to state-provided education (p. 25). They see the dynamics of microcredit loan collection as no less repressive than those of traditional debt collection, and contend that women are, in fact, harmed by microcredit programmes that leave many poor families within the programmes with an prolonged threat of impoverishment (p. 19). This is because microcredit neither challenges nor threatens the traditional institutions that oppress women. Microcredit might increase women’s income, but their status and position within their communities stay the same (pp. 19, 25, 115, 116). The authors conclude that in the case of the two villages studied, the Grameen Bank and BRAC did not provide women with control of their own resources; therefore, microcredit has not empowered them, nor transformed their gender roles (pp. 115–18).
The second argument in the book is that microcredit is, in fact, part of the neo-liberal policy of privatisation of welfare, which enables capitalism to extend its control to the poorest of the poor of the world. The authors argue that microcredit has been a tactic used in the fight to curb the spread of communism, and the attempted radicalisation of the poor, attempted in community self-help projects in Bangladesh (p. 9). For the authors, NGOS are irrevocably connected to the dismantling of state provision of welfare to the poor, which began with the structural adjustment policies of the 1980s, which forced governments to shift their expenditure away from health and welfare, making NGOs the only vehicle for addressing the social and economic needs of the poor. The authors see NGOs continuing to negatively influence political action, working in favour of the traditional institutions that subjugate women, weakening state and government, and using their relationship with international donors to discipline the government.
The authors argue that many of the evaluations and literature on development and microcredit programmes is propaganda to promote the neo-liberal view that microcredit is a human right, with the added benefit of being a miraculous means of empowering women (pp. 12, 114, 115). I believe that such arguments undermine the impact of microcredit programmes on women’s empowerment and are based on an ethnocentric, Western definition of what empowerment means. Naila Kabeer, Ann Marie Goetz et al., whom the authors cite, define empowerment as externally supported actions leading to systematic change in gender roles and liberation. They state ‘empowerment in broad terms refers to an institutional environment that enables women to take control over material assets, intellectual resources and ideology’ (p. 17). Yet, the demand of empowerment does not usually emerge spontaneously from the conditions of subjugation; rather, ‘empowerment must be externally induced by forces working with altered consciousness, and an awareness that the existing social order is unjust and unnatural’ (Batliwala 1994, 131–2). However, this is more a definition of ‘resistance’ or ‘revolution’ than of the state of being empowered.
Such arguments have negative implications for microcredit programmes and NGOs. When the authors argue that the impact of microcredit programmes on women do not lead to empowerment; rather, only to further deprivation of women and the poor, not only are they using academic, ideological theories to prove their point, along with Western, ethnocentric definitions of empowerment, but they also do not offer a real, workable alternative to either microcredit or women’s empowerment. In the literature, it would seem, microcredit programmes can only be portrayed in extremes; as either the saviour of the poor, or the downfall of the poor.
This is a controversial book, which offers an ideologically loaded framing and assessment of microcredit programmes. Although the book is rich in information on how staff and beneficiaries in two Bengali villages perceived and were affected by BRAC and Grameen Bank programmes, it is influenced by Western definitions and understandings of key concepts, such as what empowerment really means to poor people, and how poor people’s lives are affected by such programmes. In addition, the book does not offer any sustainable alternative to what the authors see as the growing negative impact of NGOs and their microcredit programmes on both the state and marginalised groups.
Review ©2012, Iman Bibars, Vice-President of Ashoka Global, and founder member of the Association for the Development and Enhancement of Women (ADEW), Egypt.
Microcredit and Women’s Empowerment: A Case Study of Bangladesh is published by Routledge.
Review originally published in Gender & Development 20 (2012).