Using Microcredit to Advance Women

This paper analyzes the outreach and impact of microcredit of three well-known microcredit programs in Bangladesh, on women:

• Grameen Bank;
• Bangladesh Rural Advancement Committee (BRAC);
• Bangladesh Rural Development Board's Rural Development Project 12 (RD-12).

The note states that the programs found that women generally have less access to financial services due to:

• Limited social and economic mobility;
• Lack of physical collateral;
• Poverty.

Further the paper details that these programs follow a group based approach and are beneficial in the following ways:

• Provide self employment to women and the poor and increase their income;
• Finance income-generating activities;
• Smooth consumption fluctuations due to seasonality in income and employment;
• Increase women's options for optimizing the use of available resources, including time, across activities;
• Provide a forum for women to interact and to develop bonds that provide economic security outside traditional household settings.

The paper concludes that the programs have:

• Affected the allocation of household resources;
• Empowered women within the household;
• Enhanced household spending per capita by about 0.40 percent;
• Improved children's welfare;
• Increased women's participation in the labor force.

Lastly, the paper observes that these results represent only the short term effects of microcredit programs; it remains to be seen whether these effects are sustainable over time.