Microfinance and Women’s Empowerment Part 2
Hailed as a powerful mechanism for fostering economic independence and empowering women, microfinance has been profiled in the spotlight in recent years. In my second article regarding the topic, I want to further explore the capabilities and limitations of microfinance through a specific case study.
Broadly defined, microfinance is the provision of group-based financial services such as small loans, savings, insurance, training in business skills, and more. Provided to women in order to help them develop businesses, these tools can ultimately be used as mechanisms for changing not only the economic constraints imposed upon women in many societies, but also the social, cultural, and political constraints that perpetuate the cycle of poverty. However, the success of microfinance programs is difficult to gauge. Current information often comes in the form of anecdotes, many of which leave out unintended consequences.
Despite the necessity for more information, it has become apparent that current microfinance programs are lacking in some components. First, according to the UNFPA, not enough programs are targeted at young women, one of the most vulnerable populations. In addition, unintended consequences such as gender violence provoked by women’s economic gain can be detrimental to the gains made. Before encouraging and implementing microfinance programs aimed at women, it’s important to understand unintended consequences and areas for further improvement.
One program cited by the UNFPA that can provide insight into such areas is SHAZ! (Shaping Health of Adolescents in Zimbabwe). The program was one of the few that specifically targeted young girls 16-19 years old who were not enrolled in school. Many were orphans as well. The program had four components: training in life skills, training in business management, development and execution of an individual business plan, and repayment of the loan given. While training in life skills and business management were well attended, only a small proportion of the girls returned the initial loans given. More alarmingly, it was common for SHAZ participants to be subject to sexual advances and even gender-based violence as a result of their business endeavors.
The success of the SHAZ program was analyzed two years after its inception in 2001. It unveiled some crucial factors to consider. Most of the girls who were successful received support from friends, family members, and their social network. Many had family members with previous business knowledge. The need for truly trustworthy mentors was also underscored by the study. It also found that the program could increase the girls’ risk to sexual advances and increase their chances of contracting HIV/AIDS—the opposite effect of the desired result of the program.
Taking these lessons and the collapse of the Zimbabwean market into consideration, the SHAZ program remodeled the program to emphasize vocational training as the core of its program instead of credit and business skills. Social support was built by seeking community leader involvement and peer networking. The program has also highlighted the need to realize the realities of the job market. It’s necessary to provide training for vocational areas that are in demand and are jobs for, which is especially difficult in countries with volatile economies such as Zimbabwe.
The SHAZ program and many others are among the first to implement microfinance programs aimed at empowering women and reducing negative health outcomes. By analyzing their results closely, invaluable lessons about the successes and pitfalls of microfinance can be learned.
Joy Liu
Durham, North Carolina
Team 2: Servant Scholars
Freshman – Duke University
Sources: Change, Choice, and Power: Young Women, Livelihoods and HIV Prevention (UNFPA)
About the author
Joy Liu, 18, Duke University, Loma Linda, CA – As an East Villagers intern, I would like to explore global issues such as women's education and health disparities. My interests include global health and visual arts. I look forward to launching an EVSS+ project that will encourage youth participation in non-profit and service work.
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When I think of microfinance, I think of a loan to buy a goat or some chickens. So how does the business that the women do for microfinance make them more susceptible to sexual violence?
Awesome topic, I’m really interested!
In the process of selling products and engaging in business, many of these girls are at an increased risk of being subjected to sexual advances. It’s not really clear whether that stems from men challenging the notion of economically independent women, but there are numerous stories of police officers or other men on the street making passes at women trying to do business.
I am really interested in this! I think that this could really help in improving the world poverty situation. I know in your definition of mircrofinance you didn’t really specify a gender. Are there organizations that do this same thing for men?
Yeap! The examples I gave were for organizations that specifically supported microfinance for women, but there are numerous microfinance projects for men and women all around the globe.