Microfinance and Women’s Empowerment: A Study of ‘VDRC-Nepal’ in Jamuniya, Nepal.

Abstract

The present study has examined the impact of micro loans on women‟s economic activities. It has specifically highlighted how women‟s income generating activities through small loans help to improve their status in household and local communities. This study is based on eleven semi-structure interviews, two focus group discussions and field observation. The term „empowerment‟ including its three dimensions: identity, agency and critical consciousness, has been applied as a theoretical lens to further clarify the informants‟ views on the role of micro loans to improve their household and community role and responsibilities.

Findings of the empirical study have shown that the access to small loans for income generating activities have positive impact on women‟s empowerment. Women‟s participation in micro credit has increased their mobility contributing to the change in the social values. Further, women‟s active participation in local issues mobilization has changed community perception on women‟s roles and responsibilities. However, in some cases, under the pressure of other family members, small loans have been used in purposes other than income generating activities making already weak women more vulnerable.

Analytically, this study underlines that microfinance programs are significant sources of financial services for women, particularly in remote areas where there is absence of banks and other financial institutions. Although the microfinance has provided financial services to poor and needy women, it has not been able to meet their expections and necessities.