Picture Credit: Brac
Bangladesh built a global reputation on a simple promise: lend to
women and you don’t just fight poverty, you change power. It’s a compelling
story. But inside many households, another story plays out. A woman signs the
passbook, attends the weekly meeting, and carries the debt. Then a husband,
brother, or son decides where the money goes.
A study by Anne Marie Goetz and Rina Sen Gupta followed loans past
the point of disbursement to see who actually controlled them (Goetz &
Gupta, 1996). Their finding was blunt: many women borrowers had limited or no
say over how their loans were used, even as they remained responsible for
repayment. In practice, a large share of loans financed activities managed by
men. That’s inclusion on paper, not in life.
Early “women in development” thinking focused on getting women
access - to training, to jobs, to credit. It was a start, and it
mattered. But access isn’t the same as control. Later, “gender and
development” thinking asked harder questions: inside the home, who decides? Who
owns the asset you buy with the loan? Who keeps the earnings? Who bears the
risk if the business fails? These are the questions that turn a passbook into
power or reveal that nothing has changed at all (Rathgeber, 1990).
The microfinance model has real strengths. It reaches villages the
formal banking system still struggles to serve. It creates a weekly rhythm of
saving and repayment. It mobilizes social ties. But the model also runs on
incentives. Field staff get praised for high repayment, not for proving that
the woman borrower is the one choosing the enterprise, signing purchase orders,
holding the account, and keeping the proceeds. When the scoreboard celebrates
repayment and scale above all else, don’t be surprised if family power settles
the rest.
The broader evidence, meanwhile, tells us to keep our claims
sober. A careful analysis pooling seven randomized evaluations of microcredit
expansions across several countries found small average gains in business
activity and consumption useful, but not the sweeping transformation many hoped
for (Meager, 2019). Microcredit works for some, under the right
conditions, but it’s no magic wand. If empowerment is the goal, credit alone
rarely gets you there.
Some research in Bangladesh suggests that participation in group
lending can reduce intimate partner violence by widening women’s social support
and public presence (Schuler et al., 1996). Other studies document mixed or
adverse effects, including economic pressure, husbands taking control of loans
or earnings and backlash. The lesson is not to retreat from credit; it’s to
design for the reality of gendered power. Programs that celebrate outreach but
ignore safety are rolling dice with women’s lives.
The bottom line is clear, In Bangladesh, credit can steady a
household and help some businesses, but it is not a complete or instant
solution. When credit is paired with rights, assets, safety, and voice, it can
open a path to real change. If we ignore who decides inside the home, we will
keep confusing a signature with agency. Empowerment isn’t paperwork. It’s
control.
References:
1. Goetz, A. M., &
Gupta, R. S. (1996). Who takes the credit? Gender, power, and control over loan
use in rural credit programs in Bangladesh. World development, 24(1),
45-63.
2. Rathgeber, E. M.
(1990). WID, WAD, GAD: Trends in research and practice. The journal of
developing areas, 24(4), 489-502.
3. Schuler, S.
R., Hashemi, S. M., Riley, A. P., & Akhter, S. (1996). Credit programs,
patriarchy and men's violence against women in rural Bangladesh. Social science
& medicine (1982), 43(12), 1729–1742.
https://doi.org/10.1016/s0277-9536(96)00068-8
4. Meager, R.
(2019). Understanding the average impact of microcredit expansions: A
Bayesian hierarchical analysis of seven randomized experiments. American
Economic Journal: Applied Economics, 11(1), 57–91.
5.
https://blog.brac.net/heres-what-happens-when-microfinance-grows-up/
This post made me reflect on how women’s access to resources does not always translate into real control. It also reminded me of another idea from Rathgeber (1990), who states, “when women’s income-generating projects do prove to be successful and become significant sources of revenue, they often are appropriated by men” (p. 492). Additionally, it brings to mind another dilemma: if women have access to loans, they often lack control; if they don’t, it becomes a complicated struggle just to obtain them. According to the Global Findex 2017, more than half of the unbanked population worldwide are women. In Ecuador, the Central Bank reported in 2018 that only 22% of credits were granted to women heads of households, a figure that drops to 14.4% in rural areas. Facing these barriers, many women turn to family, friends, or informal lenders. The loans they do obtain are usually small, less than $1,000, enough to cover emergencies like school supplies. Yet, many women do not even have assets in their name to use as collateral, because much of their time is devoted to unpaid domestic work.
ReplyDeleteHowever, I want to share one women-led initiative that caught my attention for showing how women organize to change this reality. In Cotacachi, in Ecuador’s Northern Highlands, community savings and loan groups led by the UNORCAC Indigenous Women’s Committee have opened a different path. María Lanchimba, president of the savings groups, explains: “The savings groups were created because women in our communities who do not work for pay face many difficulties accessing credit. What do they ask for? First, a payment plan to know where we are going to pay from, and we don’t have that. That’s one obstacle. Another is that they also require the husband’s signature, and if the husband does not agree, they do not authorize it. We don’t want to just be fillers; we want to be in spaces where our voices are heard for decision-making.” The savings groups allow women to access small loans, strengthen their autonomy, generate savings, and address situations of violence, all while consolidating community organization. Today, this body comprises an assembly of about five hundred women, organized into 31 groups that elect leadership responsible for various areas: violence, production, crafts, agroecology, health, and financial management.
The initiative also reflects men’s reactions to women’s leadership: Jenny recalls that initially, many men did not approve of their wives attending the meetings. “But later, when they realized it also helped the family, they didn’t see it as badly. Now, if a woman cannot attend a meeting, her husband goes instead because of the fines.” Over time, some men even became members.
“At first, they just came out of curiosity, to see what their wives were doing, but then they saw the results and wanted to join as well. The only condition for men was that they had to perform the same tasks as women. They take turns attending meetings, cooking, wearing the apron, and helping at fairs; they are not exempt from being men.”
Resources:
Cañada, E. (2014, May 5). Cajas comunitarias en Cotacachi: una apuesta por la economía popular y solidaria [Community savings groups in Cotacachi: a commitment to the popular and solidarity economy]. Albasud. Retrieved from https://www.albasud.org/noticia/es/569/cajas-comunitarias-en-cotacachi-una-apuesta-por-la-econom-a-popular-y-solidaria
Constante, S. (2020, October 18). Las mujeres ecuatorianas no son sujetos de crédito [Ecuadorian women are not creditworthy]. La Barra Espaciadora. Retrieved from https://labar
Thank you so much for this thoughtful comment. I really like how you keep the focus on the gap between access and real control, and your Rathgeber quote makes that point very clearly. Your example from Cotacachi is especially helpful because it shows a women-led model in practice, not just in theory. Hearing from María Lanchimba about rules that don’t require a husband’s signature, and about how the groups build savings, small loans, and support against violence, really brought it to life. I also appreciate the detail on how men’s participation changed over time without letting them take over the space.
DeleteI’m taking two simple lessons back to my Bangladesh focus. First, we shouldn’t just celebrate repayment rates; we need to check who actually decides, whose name is on the account, who authorizes withdrawals, who chooses the business, and where the earnings go. Second, credit works best when it comes with support: trusted spaces for women to meet, links to GBV services, childcare or meeting times that fit care responsibilities, and clear ways for men to support without recentralizing control.
Reading your post reminded me of situations I have seen back home in Bangladesh, especially in rural areas where microfinance has been such a big part of development programs. In my own village, I often noticed that women were the official borrowers in Grameen Bank or BRAC groups. They attended the meetings, carried the passbooks, and were publicly recognized as participants. But in practice, it was usually their husbands or sons who decided how the loan would be used. I remember one neighbor who took a loan in her name, but the money went directly into her husband’s small trading business. Your reference to Goetz and Gupta’s (1996) study really resonated with me, because I have literally seen that play out in everyday life.
ReplyDeleteI have also seen cases where women took microloans or small grants not because they wanted to empower themselves, but simply to help their families cope with short-term poverty. For example, some used the money to buy food during a difficult season, pay for school fees, or cover medical expenses. These decisions did not lead to long-term empowerment, but they did help households survive immediate hardships. In that sense, microfinance sometimes functions more as a coping mechanism than as a path toward self-empowerment.
Thank you for sharing this. What you describe matches what I have seen too. Women are the official borrowers, but often husbands or sons decide how the money is used. Your story about the neighbor whose loan went straight into her husband’s business is exactly the kind of thing Goetz and Gupta wrote about.
DeleteI also agree that many loans are used for short-term needs food, school fees, medicine rather than starting a business. That helps families get through a hard time, but it doesn’t always change who has power at home.
You raised a good issue regarding the real decision-makers and beneficiaries of micro-credit. Micro-credit certainly brought changes to some women’s lives, and failed in some cases. In a conservative patriarchal society, it’s not easy for women to make financial decisions on their own.
ReplyDeleteTo relate to your arguments of “real control” over money, I want to share an experience from my journalism days in Bangladesh. After the infamous Rana Plaza disaster in 2013, many initiatives were launched to improve working conditions in Bangladesh's garment industry. Numerous international organizations aimed to reform the sector. I recall one of their main focuses was on digitizing wages to ensure transparency. Most factories still pay wages in cash to their workers, who are mostly women. It was argued that paying through bank accounts or mobile financial services would give women workers a chance to open financial accounts, leading to greater economic empowerment. Some NGOs, with support from the Bill & Melinda Gates Foundation, helped many garment factories digitize their wage payments.
This transformation was viewed as a positive change in local media. The digitization of wages did streamline the process of receiving payments. However, it also created challenges for many women. During a visit to an industrial area, I encountered several women who were opposed to the digitization. I realized that instead of empowering female workers, it took away their control.
One worker shared her experience: “My husband mostly manages my Bkash account" (a popular mobile financial service in Bangladesh). "Whenever my salary comes in, he cashes out the money and spends it. I have nothing left for myself.” I asked, “Didn’t he take your salary before?” She responded, “He always took my salary. But I had some extra income that he didn’t know about, which I could keep for myself. For example, if my salary is 10,000 taka, I might earn 13,000 taka per month with overtime. I wouldn’t disclose that extra 3,000 taka to my husband and would hand over only my salary to him. But since they started depositing my wages directly into my mobile financial account, I can’t hide that extra money from him anymore. Moreover, he accuses me of lying and concealing this additional income all these years.”
I found her story shocking and relatable; it highlights the issue of universal interventions that don’t take context into account. Despite working long hours every day, she cannot enjoy her salary. On payday, her husband takes all the money, telling her, “If you need money for anything, just let me know.”
Resources:
1. Blog post (BSR)
Moffat, E. (2022, January 19). What if all garment workers in Bangladesh were financially included? BSR. https://www.bsr.org/en/blog/what-if-all-garment-workers-in-bangladesh-were-financially-included
2. Web article (UNDP/Better Than Cash Alliance)
Liller, S., & Nshuti Mbazi, L. (2025, September 11). Digital wages can unlock women’s economic power in Bangladesh. UNDP. https://sdgfinance.undp.org/news-events/digital-wages-can-unlock-womens-economic-power-bangladesh
3. Press release (IFC)
International Finance Corporation. (2020, October 31). IFC presents business case for wage digitization in Bangladesh’s readymade garment sector [Press release]. https://www.ifc.org/en/pressroom/2019/ifc-presents-business-case-for-wage-digitization-in-bangladeshs
Thank you for sharing this experience. It fits exactly with the point I’m trying to make access to a financial tool is not the same as control over money. I appreciate how you show both sides digitized wages can be faster and safer, but in some homes it can make women more visible to control and pressure. The worker’s story about losing her small, private cushion after wages went into a mobile account is very powerful. It shows how a “good” reform can quietly take away a woman’s room to breathe.
ReplyDeleteYour example makes me think about what would have made digitization work better for her. Choice matters cash or digital, not one-size-fits-all. Privacy matters strong PINs, messages that don’t reveal balances, and help to change SIMs or numbers if someone else has access. Separate, personal accounts and easy ways to move a bit into a private savings pocket could protect small amounts. And any rollout should come with clear information for women, not just for factory managers, plus links to support if there is family pressure or violence.
Thank you raised this!!