Microcredits, Returns and Gender: Of Reliable Poor Women and Financial Inclusion in South Asia

  • Christa Wichterich


This chapter discusses microcredits at the intersection of four power regimes: the international financial market, development aid, policies of the nation state, and local and household systems of social reproduction and production. Gender, class/caste, race and post-colonial North–South relations as social categories of inequality cross cut these power regimes. Microcredits are a gendered instrument for inclusion into the financial market based on the narrative of a high female repayment morale. Development aid has adopted the Grameen Bank model and links lending to productive investment and ‘income-generating activities’ mainly in non-agricultural sectors. Thus microcredits facilitate a restructuring of rural economies from subsistence to market orientation and imply a financialization of everyday life and social reproduction in villages. However, owing to interest rates of 35 per cent, mostly consumptive investment and multiple lending, many women have found themselves caught in a spiral of debt. In 2010, following a period of rapid expansion, overheating and oversupply, the microcredit industry crashed in the Indian state of Andhra Pradesh. Highly indebted women stopped repayment of loans, and some even committed suicide. The chapter highlights the paradox and ambivalent effects of microcredit on poverty reduction and women’s empowerment and discusses them as vehicles for leaving poverty management, in accordance with neoliberal ideology, up to the poor themselves and ease the responsibilities of the nation-state for development aid.


Microcredits Gender Financial inclusion Development aid 


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© The Author(s) 2017

Authors and Affiliations

  • Christa Wichterich
    • 1
  1. 1.International Center for Development and Decent WorkKasselGermany

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