Microfinance Macro-Consequences

2011 Words9 Pages
Paradoxes abound in the English language; from comical ones like “jumbo shrimp” to more profound ones like “deafening silence”. But paradoxes are more than literary terms, they also exist in real situations as well. For example, one method of reducing world poverty seems to be an inherent paradox. When a country is impoverished it seems counterintuitive that one of the most desirable ways to alleviate large-scale poverty is by loaning money to the people. Despite this, microloans have improved countless economies in impoverished areas; most notably, in Africa and Southeastern Asia. Certain countries have received more attention than others and their situations have been used as models for further expansion of the micro-financial…show more content…
For example, some women use their microloans to create a family business based on local crafts. It is said that that “for every 100 taka lent to a woman, household consumption increases by 18 taka; interestingly the figure is 11 taka if the same amount was lent to a man”(Amin, Rai, and Topa). Although critics argue that loaning to women is not a shortcut to gender-equality, it is undeniably a step in the right direction. Some studies say that only 45% of loans given to women stay solely in women`s hands; yet, studies indicate that the very act of receiving a loan allows a woman to have more say in the household which, in turn, leads to the furthering of education and sanitation (mircoCredit). This supports the idea that loaning to women is not merely an investment in an individual, but an investment in a family. For example, Runi Mamun, of rural Nowapara, Bangladesh, uses her microloans to help the family. With only $1,000 worth of loans, she has started a jamdani (decorative sari) weaving business, which employees her family members, and bought a cow. On a more personal note, her newfound economic independence has earned her respect in her community. She plans not to marry unless her suitor is as financially stable as she (Burns). This ideology is a drastic departure from the male-dominated ideologies that pervade these rural, impoverished areas. In addition, the Grameen Kaylan
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