The End of Imagination? Understanding New Developments in Microfinance



Microfinance drew attention to itself beginning the day it was born. From day one, its fate was hotly debated by ever-colliding camps of ardent supporters and staunch critics. In this chapter, we provide an in-depth discussion on microfinance revolution and promise. We summarize the highlights of the growing literature on microfinance that have accumulated over the past three decades. The new features of the microfinance sector also are discussed in the chapter.


  1. Armendariz de Aghion, B., & Morduch, J. (2000). Microfinance beyond group lending. The Economics of Transition, 8(2), 401–420.CrossRefGoogle Scholar
  2. Armendariz, B., & Morduch, J. (2010). The economics of microfinance (2nd ed.). Cambridge, Mass: MIT Press.Google Scholar
  3. Bandiera, O., Burgess, R., Gulesci, S., & Rasul, I. (2009). Community networks and poverty reduction programmes: Evidence from Bangladesh, EOPP/ STICERD (Working Paper No. 15). London: London School of Economics, RED, Dhaka: BRAC.Google Scholar
  4. Bandiera, O., Burgess, R., Das, N. C., Gulesci, S., Rasul, I., Shams, R., & Sulaiman, M. (2012). Asset transfer programme for the ultra poor: A randomized control trial evaluation, BRAC/CFPR (Working Paper No. 22). Dhaka: BRAC Research and Development Division.Google Scholar
  5. Banerjee, A., & Duflo, E. (2011). Poor economics: A radical rethinking of the way to fight global poverty. New York: Public Affairs.Google Scholar
  6. Besley, T., & Coate, S. (1995). Group lending, repayment incentives and social collateral. Journal of Development Economics, 46, 1–18.CrossRefGoogle Scholar
  7. BIDS. (1990). Evaluation of poverty alleviation programmes. Dhaka: Bangladesh Institute of Development Studies (BIDS).Google Scholar
  8. Dev, S. M., James, K. S., & Sen, B. (2005). Causes of fertility decline in India and Bangladesh. In Mohsin Khan (ed.), Economic development in South Asia. Delhi: Tata McGraw-Hill.Google Scholar
  9. Field, E. M., & Pande, R. (2008). Repayment frequency and default in microfinance: Evidence from India. Journal of the European Economic Association, 6, 501–509.CrossRefGoogle Scholar
  10. Field, E., Pande, R., Papp, J., & Rigol, N. (2013). Does the classic microfinance model discourage entrepreneurship among the poor? Experimental evidence from India. American Economic Review, 103(6), 2196–2226.CrossRefGoogle Scholar
  11. Ghatak, M. (1999). Group lending, local information and peer selection. Journal of Development Economics, 60, 27–50.CrossRefGoogle Scholar
  12. Hossain, M. (1984). Credit for the poor: The Grameen Bank in Bangladesh. Research Monograph No. 4. Dhaka: Bangladesh Institute of Development Studies.Google Scholar
  13. Hossain, M. (1988). Credit for alleviation of rural poverty: The Grameen Bank in Bangladesh. Research Report No. 65. Washington, DC: International Food Policy Research Institute.Google Scholar
  14. Hossain, N. (2016). The aid lab: Understanding Bangladesh’s unexpected success. Oxford: Oxford University Press.Google Scholar
  15. Hossain, M., & Bayes, A. (2009). Rural economy and livelihoods: Insights from Bangladesh. Dhaka: AH Development Publishing House.Google Scholar
  16. Hossain, M., Sen, B., & Sawada, Y. (2016). Bangladesh: Jobs and Growth in an Urbanizing Economy. In M. Rama and G. Betcherman (eds.), Jobs For Development: Challenges and Solutions in Different Country Settings. New York: Oxford University Press.Google Scholar
  17. Hsu, B. Y. (2014). Alleviating poverty or reinforcing inequality? Interpreting micro-finance in practice, with illustrations from rural China. The British Journal of Sociology, 65, 245–265.CrossRefGoogle Scholar
  18. Hulme, D., & Mosley, P. (eds.). (1996). Finance against poverty. London: Routledge.Google Scholar
  19. Imai, K. S., & Azam, M. S. (2012). Does microfinance reduce poverty in Bangladesh? New evidence from household panel data. Journal of Development Studies, 48(5), 633–653.CrossRefGoogle Scholar
  20. Jaim, W. M. H., & Hossain, M. (2011, October 12). Women’s participation in agriculture in Bangladesh 1988–2008: Changes and determinants. Paper presented in the pre-conference event on “dynamics of rural livelihoods and poverty in South Asia”, 7th Asian Society of Agricultural Economists (ASAE) International Conference Hanoi, Vietnam.Google Scholar
  21. Khandker, S. R. (2000). Fighting poverty with microcredit: Experience in Bangladesh. Washington, DC: World Bank/Oxford University Press.Google Scholar
  22. Khandker, S. R. (2005). Microfinance and poverty: Evidence using panel data from Bangladesh. World Bank Economic Review, 19(2), 263–286.CrossRefGoogle Scholar
  23. Khandker, S. R., & Samad, H. A. (2013). Are microcredit participants in Bangladesh trapped in poverty and debt? Policy research (Working Paper No. 6404). Washington, DC: World Bank.Google Scholar
  24. Kono, H., & Takahashi, K. (2010). Microfinance revolution: Its effects, innovations, and challenges. The Developing Economies, 48(1), 15–73.CrossRefGoogle Scholar
  25. Kothari, R. (1993). Growing amnesia: An essay on poverty and the human consciousness. New Delhi: Viking.Google Scholar
  26. Mahmud, W., & Osmani, S. R. (2016). The theory and practice of microfinance. New York: Routledge.Google Scholar
  27. Mahmud, W., & Osmani, S. R. (2017). The theory and practice of microcredit. New York: Routledge.Google Scholar
  28. Matin, I., & Hulme, D. (2003). Programs for the poorest: Learning from the IGVGD program in Bangladesh. World Development, 31(3), 647–665.CrossRefGoogle Scholar
  29. Mersland, R., & Strøm, R. Ø. (2010). Microfinance mission drift? World Development, 38(1), 28–36.CrossRefGoogle Scholar
  30. Morduch, J. (1999). The microfinance promise. Journal of Economic Literature, 37(4), 1569–1614.CrossRefGoogle Scholar
  31. Munshi, K., & Myaux, J. (2006). Social norms and the fertility transition. Journal of Development Economics, 80, 1–38.CrossRefGoogle Scholar
  32. Osmani, S. R. (1989). Limits to the alleviation of poverty through non-farm credit. Bangladesh Development Studies, XVII(4), 1–19.Google Scholar
  33. Osmani, S. R. (2012). Asset accumulation and poverty dynamics in rural Bangladesh: The role of microcredit (Working Paper No. 11). Dhaka: Institute of Microfinance.Google Scholar
  34. Osmani, S. R. (2015). The growth-equity nexus in Bangladesh: An analysis of recent experience. Background Paper prepared for the Seventh Five Year Plan. Dhaka: GED, Planning Commission.Google Scholar
  35. Osmani, S. R., & Khalily, M. A. B. (2011). Reading in microfinance: Reach and impact. Dhaka: University Press Ltd.Google Scholar
  36. Osmani, S. R., & Sen, B. (2011a). Dynamics of poverty in rural Bangladesh: A research framework (Working Paper No. 9). Dhaka: Institute of Microfinance.Google Scholar
  37. Osmani, S. R., & Sen, B. (2011b). Inequality in rural Bangladesh in the 2000s: Trends and causes. The Bangladesh Development Studies, 34(4), 1–36.Google Scholar
  38. Pitt, M., & Khandker, S. (1998). The impact of group-based credit programs on poor households in Bangladesh: Does the gender of participants matter? Journal of Political Economy, 106(5), 958–996.CrossRefGoogle Scholar
  39. Razzaque, A. (2010). Microfinance and Poverty Reduction: Evidence from a Longitudinal Household Panel Data Base. Bangladesh Development Studies, XXXIII(3), 47–68.Google Scholar
  40. responsAbility. (2015). Microfinance market outlook 2016: Developments, forecasts, trends. ResponsAbility investments for prosperity.Google Scholar
  41. Robinson, M. (2001). The microfinance revolution: Sustainable finance for the poor. Washington, DC: World Bank.CrossRefGoogle Scholar
  42. Sen, A. (1981). Poverty and famines. Oxford: Oxford University Press.Google Scholar
  43. Stiglitz, J. E. (1990). Peer monitoring and credit markets. World Bank Economic Review, 4(3), 351–366.CrossRefGoogle Scholar
  44. Zohir, S., Mahmud, S. Sen, B. Asaduzzaman, M. Islam, Md. J. Ahmed, N., & Mamun, A. A. (2001). Monitoring and evaluation of microfinance institutions. (Miemo.). Dhaka: Bangladesh Institute of Development Studies (BIDS).Google Scholar

Copyright information

© The Author(s) 2017

Authors and Affiliations

  1. 1.York UniversityTorontoCanada
  2. 2.University of AberdeenAberdeenScotland
  3. 3.University of Edinburgh Business SchoolEdinburghScotland
  4. 4.International Food Policy Research Institute (IFPRI)Washington, DCUSA

Personalised recommendations