Case Study
Using Microcredit to Advance Women
Analyzing the impact of microcredit on women
4 pages
This paper analyzes the outreach and impact of microcredit of three well-known microcredit programs in Bangladesh, on women:
- Grameen Bank;
- Bangladesh Rural Advancement Committee (BRAC);
- Bangladesh Rural Development Board's Rural Development Project 12 (RD-12).
The note states that the programs found that women generally have less access to financial services due to:
- Limited social and economic mobility;
- Lack of physical collateral;
- Poverty.
Further the paper details that these programs follow a group based approach and are beneficial in the following ways:
- Provide self employment to women and the poor and increase their income;
- Finance income-generating activities;
- Smooth consumption fluctuations due to seasonality in income and employment;
- Increase women's options for optimizing the use of available resources, including time, across activities;
- Provide a forum for women to interact and to develop bonds that provide economic security outside traditional household settings.
The paper concludes that the programs have:
- Affected the allocation of household resources;
- Empowered women within the household;
- Enhanced household spending per capita by about 0.40 percent;
- Improved children's welfare;
- Increased women's participation in the labor force.
Lastly, the paper observes that these results represent only the short term effects of microcredit programs; it remains to be seen whether these effects are sustainable over time.