From Gender Disparity to Women’s Empowerment : A critical evaluation of the impact of selected microfinance programs on women’s empowerment in rural Bangladesh.

Author: Faraha Nawaz

Nawaz, Faraha, 2015 From Gender Disparity to Women’s Empowerment : A critical evaluation of the impact of selected microfinance programs on women’s empowerment in rural Bangladesh., Flinders University, School of Social and Policy Studies

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Bangladesh is one of the most densely populated countries in the world. It is also characterized by extreme poverty and inequality. Gender discrimination and disempowerment of women are among the root causes of this situation. Neither the government nor the market has been able to reverse this and meet the welfare needs of the majority of the population. When NGOs began operating, one of their prime methodologies was to empower impoverished women by offering them collateral-free loans called ‘microfinance’. However, the role of microfinance in this area has been a matter of intense debate and controversy. Research on microfinance reveals a paradox, for it has both positive and negative impacts on poverty and women’s empowerment. Such debate and paradox in the literature inspired me to conduct an in-depth study of women borrowers to explore and understand whether microfinance has had a favourable impact on their economic, socio-cultural, political and psychological empowerment.

The study suggests that microfinance brings positive changes to the poverty level amongst participating households. When poverty is reduced, women are better able to meet their practical gender needs; however, they are not empowered unless they are also able to meet their strategic gender needs, including the transformation of gender power relations from the household to state arenas. To explore how and to what extent microfinance empowers women, I have identified five different types of women borrowers, from disempowered housewives to more independent market-orientated working women. The study reveals that within these five different groups, the women belonging to groups 1 and 2, who are in receipt of credit money and involved in independent business or who work as co-workers in their husband’s business (having full control in both respects), are in a better position to transform gender power relations. However, although they showed better results in terms of all empowerment indicators at both the household and community levels, very few were involved in local politics.

I also explored why the women of groups 1 and 2 outperformed those in the other groups. The study shows that it was the ability of these two particular groups to utilize the social capital generated by their membership of microfinance programs that made the difference. When I examined other aspects of their lives, some common factors were revealed that assisted them to utilize the financial and social capital aspects of microfinance more effectively. These included their age, marital status, financial literacy, access to television and their husbands’ level of education. Although these factors were pre-existing, it was not until they were combined with microfinance that they had a positive effect. Prior to that, the women were still financially dependent on their husbands.

In short, the study demonstrates that although microfinance empowers women, it cannot bring empowerment to all women equally at all levels. Although many women were empowered at the household level and some were empowered at the market and societal level, very few were empowered at the political level. Therefore, the study argues that in order to bring about higher levels of empowerment, microfinance programs must be combined with other services such as financial literacy, socio-economic training, education, health care, social mobilization and legal support.

Keywords: Women's Empowerment, Microfinance, Gender Disparity, Economic Empowerment, socio cultural Empowerment, Political Empowerment

Subject: Sociology thesis

Thesis type: Doctor of Philosophy
Completed: 2015
School: School of Social and Policy Studies
Supervisor: Noore Alam Siddiquee