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Microfinance Challenges: Empowerment or Disempowerment of the Poor?

Is the increasing commercialization of microfinance justified?
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This book examines the complexity of links between microfinance and empowerment of clients.

The book combines theoretical reflections and case studies to examine changes in microfinance that are occurring in India, especially in South India. It states that:

  • Legitimacy of self help groups (SHGs) as institutional players has not been questioned so far;
  • Reality, however, presents a more complex and mixed picture;
  • Empowerment is often regarded as the automatic fruit of financial access;
  • Reality shows that the link between microfinance and empowerment is not linear, unequivocal or systematic.

The book suggests that there is no universal definition of empowerment. It highlights the central role of the environment, stating that the link between microfinance and empowerment is subtle because microfinance projects take place within an economic, socio-cultural and political context that is complex, evolutionary and conditions the results obtained. Finally, it discusses the importance of evaluation, highlighting the diversity in results obtained from microfinance projects.