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Women Empowerment Through Microfinance

Traditional development theories believed that a high growth rate of the economy would benefit the poor through the so-called trickledown effect. This suggests that, among the poor and the middle-class, both men and women would equally reap the fruits of high economic growth rate. However, this has been belied by actual development and in spite of the various development measures and constitutional legal guarantees –women have lagged behind in almost all sectors.

Microfinance for the poor women and for women as a whole have received extensive recognition as a strategy for poverty reduction and for women’s economic empowerment. While many microfinance institutions seek to empower women as an implicit or explicit goal, others believe they cannot afford to focus on empowerment because it is incompatible with financial sustainability or because it detracts from the core business of providing financial services.

It has been discovered through various studies that the existence of microfinance institutions has led to an increased self-confidence and increase self-esteem in women. Another benefit has been women’s increased participation in decision-making.

World Education also found that the combination of education and credit put women in a stronger position to ensure more equal access for female children to food, schooling, and medical care. Other findings also showed increased ability to make purchasing choices, manage household funds, and manage enterprise funds. Women clients have also experienced improved status and gender relations in the home. Women’s financial contributions helped them earn greater respect from their husbands and children, negotiate husband’s help with housework, and avoid family quarrels over money. The studies have also found increased respect from and better relationship within extended family and in-laws. Furthermore, it has been observed that women received more respect from their communities than they did before joining a microfinance program. Moreover, the programs have helped them in taking on greater roles in giving advice within the community, organizing for social change, and participating in community meeting – in part because they are now able to contribute financially to community need and activities such as funerals. Research also found increased political participation, including involvement in civic action and women clients being elected to office.

There are also some negative impacts and limitations to empowerment. Due to women empowerment, an increase in women’s workloads have been noticed. As they expand their businesses and participate in microfinance meeting, some women have reported ill health and exhaustion. Besides the above, there are other limitations including limits to the level and kinds of change in women’s social status, decision-making power limited to making small purchases or other smaller decisions, clients’ husbands withdrawing their support from the household, and women hiding their savings or even their businesses from their husbands.

However, for microfinance program to be cost-effective in bringing about the empowerment of women, it would require for them to:

•    Provide business training to women,

•    Invest in women’s general education and literacy,

•    Provide guidance in balancing family and work responsibilities,

•    Provide a forum for dialogue on social and political issues, such as women’s rights and community problems,

•    Give women experience in decision –making

•    Promote women’s ownership, control and participatory governance in their microfinance programs.

Microfinance, consequently, provides employment to women who have no other means of income.Women are, as a result, highly represented in self-employment and operating small income-generating activities. Therefore, microfinance institutions are considered an extraordinary opportunity as they act intentionally to empower women and to minimize the potentially negative impacts some women experience.