Description

The growth of microcredit (microfinance) schemes from the 1980s onwards had a dramatic impact on the situation of poor rural women in Bangladesh. It was pioneered by Grameen Bank (GB), an institution that initially lent primarily to poor village women, under the direction of Professor Mohammed Yunus. Most major NGOs in Bangladesh subsequently developed similar programmes, and GB-style microcredit has been imitated in many other countries. The GB model aims to make villagers into small-scale proto-capitalist entrepreneurs. While some people have been able to take effective advantage of these schemes, and the availability of relatively cheap credit has been a boon for many village households, the model is limited. The GB approach has little impact on basic issues faced by the poorer sectors of the rural population: access to land, the power structure of the village community, and (in the case of women) the oppressive nature of gender relations. In this paper I examine GB’s achievements, but also focus on two specific problems connected with GB-style microcredit in Bangladesh: its negative effects for women’s solidarity, and its consequences for the practice of dowry payments. These problems are used to illustrate some more general points about the way in which GB-style microcredit fits in with the global programme of neoliberal economics and the incorporation of Third World societies into the capitalist economic system. Lastly, I discuss recent criticisms of GB, and particularly of its failure to reach the ‘poorest of the poor,’ and examine some of the newer approaches being trialled in Bangladesh and elsewhere in South Asia.

Santi Rozario is a Senior Lecturer at the School of Sociology and Social Work, University of Tasmania. Her academic background is in sociology and social anthropology. Her PhD was on women and the relations between religious communities in a Bangladeshi village. She has continued to carry out research in Bangladesh, in areas including development studies, health (including childbirth and reproductive health), microfinance, and religion, and on diasporic Bangladeshi and South Asian communities.