MICROCREDIT FOR WOMEN: EMPOWERMENT OR PUNISHMENT

 

In one of our readings, that is the Discipline Power of Micro Credit by Josephine Lairap- Fonderson, it was obvious to understand that there are two major roles of Micro credit. The empowerment role and the disciplinarian role.

Microcredits are supports given to people to embark on Small and Medium Scale Enterprises. It is a major means of empowering women in the Third world. In Ghana, Women are supported with these Microcredit to support their businesses but it goes way beyond that. They also seek to reduce poverty and inequality, creating employment and wealth, but then does it perform just this goal? Most of these Micro Credits have high interest rates with limited time frame to pay it back. ASA Savings and Loan, formerly ASA Microfinance is a financial institution in Ghana that supports small to medium scale enterprises, it has an interest rate of 20% for any amount taken that makes it difficult for these young women to pay it back. ASA provides credits from GHC 200 TO GHC 2000 that is USD20 to USD 200 to petty traders to support their businesses, these women are expected to pay an amount every week till the last week of the month. Microfinance and Small Loans Centre (MASLOC) is a government body in Ghana that also provide soft loans for entrepreneurs and micro-small-scale loans with interest rate starting from 1%. MASLOC has a compulsory qualification that the borrower must use the money to fund a small business to enhance economic growth.

Many argue of how these rates are high, how difficult it is for these women to pay their credits on time and how there they are asked to use these monies for just economic ventures such as petty trading and capitals for their business. There are other people that also ague that these high interest rates are means of encouraging women to use the money for business and economic ventures rather than using the money for family upkeeps or home care support.

What then are the roles of these microcredits to women? Is it to support or empower women or with these high interest rates and stringent rules a means to punish them?