MaeveEnright

GlobalStudiesHonors
Friday,March18,2016
MicrofinanceandEmpoweringWomen:OriginalDraft
Economicempowermentistheactofwomengainingsocialandpoliticalpowerthrough
economicresources.Thereisalotofdisagreementgloballyaboutwhetherornotmicrofinance,
theconceptofloaningsmallamountsofmoneytoentrepreneurs,workstoeffectivelybring
womenoutofpovertyandempowerthem.
Althoughmicrocredithasitsflaws,ithashelped
manywomengaincontrolovermanyaspectsintheirlives.Inorderformicrofinancetosucceed,
womenneedapropersupportsystemthatconsiderstheeconomic,social,andpoliticalsidesof
theirlives.
Microfinanceisagreatoptionforwomeninpovertywhenithasthecorrectstarting
pointstosucceed.Microloanshavehelpedmanywomenaroundtheworldtosuccessfullyexit
thecycleofpoverty.Inanexamplehighlightedin
HalftheSky
,SaimaMuhammad,apoor
Pakistaniwomansufferingfromdomesticviolence,becamethetycoonoftheneighborhood,
andshewasabletopayoffherhusbandsentiredebt,keepherdaughtersinschool,renovatethe
house,connectrunningwatertothehouse,andbuyatelevision,(Kristof186)usingthemoney
shesavedfromherembroiderybusinessthatshestartedwithamicroloan.Manywomen,like
Saima,areabletothriveeconomicallyoncegiventheproperresourcesthroughmicrocredit.
Becausewomenlivinginpovertysooftengounnoticed,itshardtobreakthroughtowomenin
povertyandoutofthesystem,saysNatalieByrne,thedirectorofglobalimpactatDermalogica,
butmicrofinancedoes.Microfinanceisawaytogivewomenwhohavelittletonopowerat

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homeandinsocietyafightingchancetoimprovenotonlytheirlives,butthelivesoftheir
familiesandcommunities.Inplaceafterplace,whengiventheproperchanceandresources,
suchasfundingandeducation,marketsandmicrolendingareprovidingapowerfulsystemto
helppeoplehelpthemselves(Kristof187)bybuildingtheirownsuccessfulbusinessesthat
providethemwithasustainableincome.
Whenwomenbegintogroweconomically,theirfamilieslivesbeginimproveboth
sociallyandpolitically.Oftenoncewomenintheseoppressivesocietiessucceed,theyarebetter
treatedandrespectedbytheirfamiliesandcommunitiesasaresult.SharifaBibi,Saimasmother
inlawandabuser,saidAwomanshouldknowherlimits,andifnotthenitsherhusbands
righttobeather...Butifawomanearnsmorethanherhusband,itsdifficultforhimtodiscipline
her,(Kristof187)whenspeakingaboutSaimassuccessasanentrepreneur.Likemanyother
women,Saimawasavictimofseveredomesticviolence,butonceshebecameherfamilys
primarysourceofincome,herfamilynolongerfelttheneedtoabuseher.Liketheemotional
stabilityofthefamily,theirhealthalsoimprovesasthemothergainsmoreeconomicpowerin
thehousehold.Ithasbeenstatisticallyproventhatwomenaremorelikelythanmentoreinvest
theirmoneyintotheirfamilyandcommunity,meaningthatwomenaremorelikelytoinvestin
theirchildrenshealthandnutrition.As
HalftheSky
pointsout,Increasingwomenscontrol
overresources,evenintheshortrun,willimprovetheirsaywithinthehousehold,whichwill
increasechildnutritionandhealth.(Kristof195)Inadditiontohealth,womenarealsomore
likelytoputanemphasisoneducation,furtherincreasingtheprobabilitythatthefamilywillstay
outofpoverty.MicrofinanceiskeytowomensempowermentbecauseIfweretryingtofigure

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outhowtogetmoregirlsinschool,orhowtosavemorewomenfromdyinginchildbirth,the
simplestsolutionistoreallocatespending.(Kristof193)
Althoughmicrofinancehashelpedmanywomen,itistruethatmicrofinancedoesnot
alwaysworktobringpeopleoutofpoverty.Whenmicrofinanceisunsuccessful,itisoftendueto
oneofthreereasons.Firstly,somewomenarenotfitforentrepreneurshipordonothaveasolid
businessplanthatcangivethemasustainablesourceofincome.Inthesecases,somesay

traditionalcompanyemploymentmaybeabetterfit(Aguirre2),butthatisoften
justnot
realistic(Byrne)
asinmanyofthesecountries,womenarenotgiventheaccesstotraditional
employmentbecauseoftheirculture,andwhentheyareemployed,theydonotgetfairwages.
A
secondareawheremicrolendingcanbeunsuccessful,iswhenloansareunabletoberepaidafter
theyrunout
,oftenbecauseinterestcanbeashighasthirtypercentontheseloans
.Thiscanbe
detrimentaltopeopleinpovertyasitcanputthemfurtherintodebt,forcingsomewomento
borrowmoneyfromalreadypoorfamilymembersorintheworstcases,sellbodypartsto
generatesomesourceofincome.
Thelastproblemmicrofinancefacesisthelackofrestrictions
onbothwhenloansaregivenandtheinterestputontherepaymentoftheloans.AsMabrouka
MBareksaidinherspeech,
Inorderformicrofinancetowork,youneedamechanismoflaws
andregulationstoprotectthemostimpoverishedpeople,andwehavetoreallybecareful
aboutwhywearegivingtheseloans.
Formicrofinancetobesuccessful,inadditiontoapropersupportsystem,itisnecessary
forwomentohaveagoodbusinessplanthatwillgenerateasustainablesourceofincomeand
regulationsthatlimittheamountofinterestthatcanbeputontheirloans.Althoughmicrofinance
doesnotworkinallcases,itisnaivetoarguethattheremustbeasinglewayofeconomically

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empoweringwomentoendtheworldwideissueofwomensinequality.Ofcoursetherewill
neverbeonesolemethodthatwillempowereverywomeninpoverty,butdespiteitsfaults,
microfinancehashelped,andcontinuestohelp,manywomeninneed.Microfinancehas
economicallyempoweredwomenallovertheglobe,buttheanswertogenderinequality,as
NatalieByrnetalkedaboutinherspeech,is
neverjustonesolution.

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MicrofinanceandEmpoweringWomen:FinalDraft
Economicempowermentistheactofgivingsocialandpoliticalpowertowomenthrough
economics.Formanypeopleinpoverty,inordertocreateeconomicgrowthallaspectsoftheir
life,forexample,education,healthcare,andhousing,needtobeconsidered.Thereisalotof
disagreementgloballyaboutwhetherornotmicrofinance,theideaofloaningsmallamountsof
moneytoentrepreneurs,workstoeffectivelybringwomenoutofpovertyandempowerthem.
Microfinancehasprovidedameansforwomenseconomicempowerment,butonlyinthe
correctcircumstances,andthereforecannotbetheonlysolutiontotheglobalissueofgender
equality.
Microfinanceisagreatoptionforwomeninpovertywhenithasthecorrectstarting
pointstosucceed.Microloanshavehelpedmanywomenaroundtheworldtosuccessfullyexit
thecycleofpoverty.Inanexamplehighlightedin
HalftheSky
,SaimaMuhammad,apoor
Pakistaniwomansufferingfromdomesticviolence,becamethetycoonoftheneighborhood,
andshewasabletopayoffherhusbandsentiredebt,keepherdaughtersinschool,renovatethe
house,connectrunningwatertothehouse,andbuyatelevision,(Kristof186)usingthemoney
shesavedfromherembroiderybusinessthatshestartedwithamicroloan.Manywomen,like
Saima,areabletothriveeconomicallyoncegiventheproperresourcesthroughmicrocredit.
Becausewomenlivinginpovertysooftengounnoticed,itshardtobreakthroughtowomenin
povertyandoutofthesystem,saysNatalieByrne,thedirectorofglobalimpactatDermalogica,
butmicrofinancedoes.Microfinanceisawaytogivewomenwhohavelittletonopowerat
homeandinsocietyafightingchancetoimprovenotonlytheirlives,butthelivesoftheir
familiesandcommunities.Inplaceafterplace,whengiventheproperchance,marketsand

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microlendingareprovidingapowerfulsystemtohelppeoplehelpthemselves(Kristof187).
Oncewomenaregiventheresources,likefundingandeducation,theyareabletobuild
successfulbusinessesthatwillprovidethemwithasustainableincome.
Whenwomenbegintogroweconomically,theirfamilieslivesbeginimproveboth
sociallyandpolitically.Oftenoncewomenintheseoppressivesocietiessucceed,theyarebetter
treatedandrespectedbytheirfamiliesandcommunitiesasaresult.SharifaBibi,Saimasmother
inlawandabuser,saidAwomanshouldknowherlimits,andifnotthenitsherhusbands
righttobeather...Butifawomanearnsmorethanherhusband,itsdifficultforhimtodiscipline
her,(Kristof187)whenspeakingaboutSaimassuccessasanentrepreneur.Likemanyother
women,Saimawasavictimofseveredomesticviolence,butonceshebecameherfamilys
primarysourceofincome,herfamilynolongerfelttheneedtoabuseher.Liketheemotional
stabilityofthefamily,theirhealthalsoimprovesasthemothergainsmoreeconomicpowerin
thehousehold.Ithasbeenstatisticallyproventhatwomenaremorelikelythanmentoreinvest
theirmoneyintotheirfamilyandcommunity,meaningthatwomenaremorelikelytoinvestin
theirchildrenshealthandnutrition.As
HalftheSky
pointsout,Increasingwomenscontrol
overresources,evenintheshortrun,willimprovetheirsaywithinthehousehold,whichwill
increasechildnutritionandhealth.(Kristof195)Inadditiontohealth,womenarealsomore
likelytoputanemphasisoneducation,furtherincreasingtheprobabilitythatthefamilywillstay
outofpoverty.MicrofinanceiskeytowomensempowermentbecauseIfweretryingtofigure
outhowtogetmoregirlsinschool,orhowtosavemorewomenfromdyinginchildbirth,the
simplestsolutionistoreallocatespending.(Kristof193)

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Althoughmicrofinancehashelpedmanywomen,itistruethatmicrofinancedoesnot
alwaysworktobringpeopleoutofpoverty.Whilesomesay
traditionalcompanyemployment
maybeabetterfit(Aguirre2)forsomewomen,thatisoften
justnotrealistic(Byrne)
.As
NatalieByrnepointedoutinherspeech,inmanyofthesecountries,womenarenotgiventhe
accesstotraditionalemploymentbecauseoftheirculture,andwhentheyareemployed,theydo
notgetfairwages.
Oftenwhenmicrolendingisunsuccessful,itisbecausetheloanswereunable
toberepaidaftertheyrunout.Thiscanbedetrimentaltopeopleinpovertyasitcanputthem
furtherintodebt,forcingsomewomentoborrowmoneyfromalreadypoorfamilymembersorin
theworstcases,sellbodypartstogeneratesomesourceofincome.
Theloansoftencannotbe
repaidbecausetheinterestcanbeashighasthirtypercent,andloansarenotalwaysgivento
thosewithsolidbusinessplans.AsMabroukaMBareksaidinherspeech,
Inorderfor
microfinancetowork,youneedamechanismoflawsandregulationstoprotectthemost
impoverishedpeople,andwehavetoreallybecarefulaboutwhywearegivingtheseloans.
Althoughmicrocredithasitsflaws,ithashelpedmanywomengaincontrolovermany
aspectsintheirlives.Inorderformicrofinancetosucceed,womenneedapropersupportsystem
thatconsiderstheeconomic,social,andpoliticalsidesoftheirlives,agoodbusinessplanthat
willgenerateasustainablesourceofincome,andregulationsthatlimittheamountofinterestthat
canbeputontheirloans.Microfinancehaseconomicallyempoweredmanywomen,butthe
answertogenderinequality,asNatalieByrnetalkedaboutinherspeech,is
neverjustone
solution.

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WorksCited
Aguirre,DeAnne.MicrofinanceIsGoodforWomen,butItsOnlyPartoftheSolution.
HarvardBusinessReview
.N.p.,27Nov.2012.Web.15Mar.2016.
<https://hbr.org/2012/11/microfinanceisgoodforwomen>.
Byrne,Natalie.WindwardSchool.LosAngeles.15Mar.2016.Speech.
HalftheSky
.Dir.MaroChermayeff.ScreenplaybyMichaelFerrari.Perf.NicholasD.Kristof.
2012.Film.
Kristof,NicholasD.,andCherylWuDunn.
HalftheSky
.NewYork:Vintage,2010.Print.
MBarek,Mabrouka.WindwardSchool.LosAngeles.16Mar.2016.Speech.
Walt,Vivienne.DoesMicrofinancingReallyWork?ANewBookSaysNo.
Time
.N.p.,6Jan.
2012.Web.15Mar.2016.
<http://content.time.com/time/world/article/0,8599,2103831,00.html>.

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