The Impact Of Microfinance Services Among Poor Women In Ethiopia

Author : Esayas Bekele Geleta
Publisher :
ISBN 13 :
Total Pages : 335 pages
Book Rating : 4.:/5 (795 download)

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Download or read book Microfinance in Ethiopia written by Esayas Bekele Geleta and published by . This book was released on 2010 with total page 335 pages. Available in PDF, EPUB and Kindle. Book excerpt: Over the last two decades microfinance (MF) has been one of the popular and widely adopted development strategies in the majority world. Despite its popularity and prominence, microfinance has been hotly debated. This thesis critically examines three of these contentious issues, namely microfinance{u2019}s potential to reduce poverty, help build social capital and empower women. The thesis provides an in depth study of MF in Ethiopia, one of the poorest countries of sub-Saharan Africa. Among the microfinance institutions (MFIs) in the country, the thesis focuses on ACSI (the Amhara Credit and Savings Institution), which is located in the Amhara region, one of the poorest regions of Ethiopia. Despite this fact, ACSI has emerged as one of the most successful MFIs in the world. From a theoretical point of view, this thesis primarily utilizes Pierre Bourdieu{u2019}s (1986, 1996, 2000) analysis of social capital, in contrast to Robert Putnam{u2019}s (1993, 2000) understanding of this concept that has been very popular and influential throughout the world. In examining the potential of MF to empower women, the thesis is informed by Bourdieu{u2019}s analysis of class structure, while incorporating feminist critiques of his sociology. With regard to philosophical underpinnings, the study is undertaken from a Bourdieusian and feminist position. Research for this thesis was undertaken during the summers of 2007 and 2008 in both rural and urban contexts, namely the Woredas (districts) of Angolela Tera and Debrebrehane, respectively. While the fieldwork was guided by an ethnographic methodology, observation, in-depth interviews and focus group discussions were utilised as methods of data collection. The study examines MF within the wider socio-economic context of Ethiopia. It locates MF within the broader formal and informal financial facilities prevalent in the country. The research provides a critical analysis of the organisational structure and institutional practices of ACSI that have helped it to emerge as the leading MFI in Africa. The thesis looks at the institutional policy frameworks and day to day operations of the organisation vis-à-vis the cultural ideologies and practices of the people of the Amhara region. The key findings of the thesis revealed that livelihoods for many clients of ACSI were improved through accessing finance, running small businesses and generating incomes. However, it cannot be assumed that credit necessarily expands economic capital. On the contrary, the research showed a significant degree of vulnerability and a further impoverishment for some of the credit clients. Moreover, despite the formation of micro-groups for the delivery of micro-loans and centres for collecting voluntary savings, the research findings suggest that MF in the context of ACSI has played an insignificant role in creating new or expanding the pre-existing forms of networks, links and association (social capital) among micro-group members. Rather than bringing about social integration, ACSI{u2019}s system of credit delivery, which incorporates peer enforcement and monitoring, proved to be a source of conflict among many group members. ACSI{u2019}s role in terms of empowering women has also been limited. Cultural ideologies and practices restrict women{u2019}s mobility and property ownership such as land. Women are restricted from a decision making role over the use of loans, management of loans and income generated. They do not also participate in lucrative markets such as cattle markets. When women engage in running micro-business, their domestic roles are not shared. Despite the potential of centre meetings to empower women, women{u2019}s participation is controlled by men. The study showed that the poorest women are the most discriminated against. The thesis fundamentally deconstructed the common simplistic association of credit provision with poverty reduction, social capital and women{u2019}s empowerment.