Can microcredit worsen poverty? Cases of exacerbated poverty in Bangladesh
Publication date
2011-11-01Subject
EconomicsKeywords
DebtFinance
Aid effectiveness
Microfinance
Protection
Microcredit
Development in Practice Journal
DiP
Country
Bangladesh
Metadata
Show full item recordJournal
Development in PracticeDocument type
Journal articleLanguage
EnglishDescription
Worldwide, microcredit has been recognised as a successful innovation in poverty alleviation. However, some claim that microcredit exacerbates poverty in developing countries. This study examines cases in Bangladesh where microcredit has actually worsened poverty among borrowers and investigates the underlying reasons for this adverse trend. Our results show that microcredit can exacerbate poverty in four interrelated circumstances. We argue that households living in extreme conditions of poverty who possess minimal or no surplus financial capacity to cope with contingencies are prone to adverse effects of microcredit, and suggest ways to avoid microcredit borrowers falling victims to such unintended consequences.<p>This article is hosted by our co-publisher Taylor & Francis.</p>Pages
12ISSN
0961-4524EISSN
1364-9213ae974a485f413a2113503eed53cd6c53
10.1080/09614524.2011.607155