womens empowerment through sustainable microfinance

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  • 7/29/2019 Womens Empowerment Through Sustainable Microfinance

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    mens Empowement through Sustainable Micro-finance: Rethinking Best Practice Lindai Mayoux Sept 200

    WWOOMMEENNSSEEMMPPOOWWEERRMMEENNTTTTHHRROOUUGGHHSSUUSSTTAAIINNAABBLLEEMMIICCRROO--

    FFIINNAANNCCEE::RREETTHHIINNKKIINNGGBBEESSTTPPRRAACCTTIICCEE

    Linda Mayoux1DISCUSSION DRAFT September 2005

    Please send comments, suggestions and additions to the author: [email protected] contributions will be fully acknowledged

    .

    Micro-finance programmes targeting womenbecame a major plank of donor povertyalleviation and gender strategies in the 1990s.Increasing evidence of the centrality of gender

    equality to poverty reduction and womenshigher credit repayment rates led to a generalconsensus on the desirability of targetingwomen. Not only reaching but alsoempowering women became the secondofficial goal of the Micro-credit SummitCampaign.

    Donor funding however has generally beenconditional on compliance with some variant ofCGAPs2 Guidelines for Best Practice aiming atfinancial sustainability. Literature prepared for

    the international and regional Micro-creditSummits from 1997, many donor statements oncredit and NGO funding proposals present anextremely attractive vision of increasingnumbers of expanding, financially self-sustainable micro-finance programmesreaching large numbers of poor womenborrowers. Through their contribution towomens ability to earn an income micro-finance is assumed to initiate a series ofvirtuous spirals of economic empowerment,increased well-being for women and their

    families and wider social and politicalempowerment. Funding for programmes whichplace prime emphasis on womensempowerment decreased.

    This paper argues that there is a need for aserious rethink of many currently acceptedtenets of Best Practice in the light of existingevidence of gender impact. There is evidence

    INTRODUCTION

    PARTICIPATORY EMPOWERMENTSURVEY: KASHF PAKISTANConducted by Kashf staff to examinewomens own views and criteria forempowerment and how they saw theirsituation

    90% of Kashf clients consideredthemselves to be in the less or leastempowered category by local criteria: Subject to many kinds of domesticviolence Dependant on husbandAlways having quarrels with each other. Suicide cases No basic rights with many restrictionsfrom the husband No security

    The requirements to increase theirempowerment were seen to be:

    Having their own income (85%)

    Freedom of mobility (70%)

    Equal participation of men and women indecision making (92%)

    Kashf 2004. See also Sardar, Mumtaz,Hossein and Mayoux 2005

    Gender and micro-finance website: http://www.genfinance.net and http://lindaswebs.org.uk

    mailto:[email protected]:[email protected]
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    of significant potential for micro-finance toenable women to challenge and change genderinequalities at all levels if there is a strategicgender focus. There have also been manyimportant recent innovations in products andservices to enable women to better benefit.

    Nevertheless benefits cannot be assumed andeven financially sustainable micro-finance if it isgender blind may seriously disempower womenand increase inequality. There is a needtherefore to make gender Best Practiceintegral to micro-finance design rather than amarginal and marginalised add-on to financialsustainability or poverty reduction.

    The paper is based on secondary sources andthe authors research and consultancy forprogrammes in Asia, Africa and Latin America.3

    Section 1 of the paper gives an overview ofthree contrasting paradigms of BestPractice, each of which have differingunderstandings of women's empowermentand the aims of microfinance: the feministempowerment paradigm, the povertyalleviation paradigm and the financial self-sustainability paradigm. In the last twoparadigms, despite the rhetoric ofempowerment, gender policy risksevaporation into merely using womenstime and resources for programme

    efficiency or community development. Thereis little serious attention to change in genderrelations.

    Section 2 gives an overview of evidence ofgender impact. This indicates that althoughmicro-finance programmes do potentiallyhave a significant contribution to womensempowerment, this is not an automaticconsequence of womens access to savingsand credit or group formation per se. Inmany cases benefits may be marginal andwomen may even be disempowered.

    Section 3 discusses some of the nowconsiderable experience of good genderpractice and identifies a number of criticalelements of a gender strategy for equalityand empowerment. These require acoherent vision integrated into productdesign, non-financial services andorganisational structures. Many of theseelements can to some extent beincorporated into a range of different typesof programme and reinforce rather than

    conflict with long-term financialsustainability. Others will require specificfunding and positive promotion. But thereare ways in which this can be done botheffectively and cost-efficiently. Importantlythese gender strategies also require theparticipation of men in the process ofchange.

    Section 4 outlines the responsibilities fordonors in promoting a diversity of micro-finance provision to all of which women

    have equal access and some of whichbuilds on the organisational base of micro-finance as a significant foundation forgrassroots-based change in genderrelations. Unless these changes are made,microfinance will fail to realise its fullpotential as a useful part of a holisticagenda not only for womens empowermentbut also for poverty eradication andeconomic growth. This will be incontravention of international agreementson womens human rights and the officialmandates of the donor agenciesthemselves.

    Gender and micro-finance website: http://www.genfinance.net and http://lindaswebs.org.uk

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    ECTION 1: WOMENS EMPOWERMENT AND MICRO-FINANCE: COMPETINGARADIGMS AND UNDERLYING ASSUMPTIONS

    Concern with womens access to credit andassumptions about contributions to womensempowerment are not new. Nor are they a Northernimposition.

    From the early 1970s womens movements in anumber of countries became increasingly interested inthe degree to which women were able to accesspoverty-focused credit programmes and creditcooperatives. In India organizations like Self-Employed Womens Association (SEWA) amongothers with origins and affiliations in the Indian labourand womens movements identified credit as a majorconstraint in their work with informal sector womenworkers4.

    The problem of womens access to credit was givenparticular emphasis at the first International WomensConference in Mexico in 1975 as part of the emergingawareness of the importance of womens productiverole both for national economies, and for womensrights. This led to the setting up of the Womens WorldBanking network and production of manuals forwomen's credit provision5. Other womensorganizations world-wide set up credit and savingscomponents both as a way of increasing womensincomes and bringing women together to address

    wider gender issues. From the mid-1980s there was amushrooming of donor, government and NGO-sponsored credit programmes in the wake of the 1985Nairobi womens conference (Mayoux, 1995a).

    The 1980s and 1990s also saw development andrapid expansion of large minimalist poverty-targetedmicro-finance institutions and networks like GrameenBank, ACCION and Finca among others. In theseorganizations and others evidence of significantlyhigher female repayment rates led to increasingemphasis on targeting women as an efficiency

    strategy to increase credit recovery. A number ofdonors also saw female-targeted financially-sustainable micro-finance as a means of marrying

    internal demands for increased efficiency becauseof declining budgets with demands of theincreasingly vocal gender lobbies.

    The trend was further reinforced by theMicroCredit Summit Campaign starting in 1997which had reaching and empowering womenas its second key goal after poverty reduction(RESULTS 1997). Micro-finance for women hasrecently been seen as a key strategy in meetingnot only Millenium Goal 3 on gender equality,but also Poverty Reduction, Health, HIV/AIDSand other goals.

    Competing Paradigms

    Support for targeting women in microfinanceprogrammes comes from organisations ofwidely differing political perspectives. There hasrecently been an apparent convergence ofpolicy and terminology and common concernswith sustainability, participation andempowerment as donor agencies and NGOshave attempted to address their critics, andactivists have become engaged in constructive

    dialogue.

    However, underlying the current apparentconsensus, it is possible to identify threecontrasting paradigms with different underlyingaims and understandings and different policyprescriptions and priorities in relation to bothmicro-finance itself and to gender policy assummarised in Box 1.

    They also have rather different emphases in theways they perceive the interlinkages between

    microfinance and women's empowerment asindicated in Figure 1.

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    SAVINGS

    AND

    CREDIT

    WOMEN'S

    DECISION ABOUT

    SAVINGS AND

    CREDIT USE

    WOMEN'S

    MICRO-

    ENTERPRISE

    INCOME UNDER

    WOMEN'S

    CONTROL

    WOMEN'S

    DECISIONS ABOUT

    CONSUMPTION

    INCREASED

    WELLBEING OF

    CHILDREN

    INCREASED

    WELLBEING OF

    WOMEN

    INCREASED

    WELLBEING OF

    MEN

    REPAYMENT

    INCREASED

    STATUS AND

    CHANGING ROLES

    WOMEN'S

    NETWORKS AND

    MOBILITY

    WIDER MOVEMENTS

    FOR SOCIAL,

    POLITICAL & LEGAL

    CHANGE

    INCREASED

    WAGE

    EMPLOYMENT

    FOR WOMEN

    FINANCIALSELF- SUSTAINABILITY

    FEMINIST EMPOWERMENT

    PARADIGM

    Fig. 1 VIRTUOUS SPIRALS:PARADIGMS COMPARED

    INCREASED

    INCOME

    ECONOMIC EMPOWERMENT

    INCREASED WELLBEING

    SOCIAL, POLITICAL& LEGAL EMPOWERMENT

    ABILITY TO

    NEGOTIATE CHANGE

    RELATIONS

    IN GENDER

    POVERTY ALLEVIATION

    PARADIGM

    PARADIGM

    Gender and micro-finance website: http://www.genfinance.net and http://lindaswebs.org.uk

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    Feminist Empowerment Paradigm

    The feminist empowerment paradigm did not originate asa Northern imposition, but is firmly rooted in thedevelopment of some of the earliest micro-financeprogrammes in the South, including SEWA in India. Itcurrently underlies the gender policies of many NGOs and

    the perspectives of some of the consultants andresearchers looking at gender impact of micro-financeprogrammes (eg Chen 1996, Johnson, 1997).

    Here the underlying concerns are gender equality6 andwomens human rights. Womens empowerment is seenas an integral and inseparable part of a wider process ofsocial transformation. The main target group is poorwomen and women capable of providing alternativefemale role models for change. Increasing attention hasalso been paid to men's role in challenging genderinequality.

    Micro-finance is promoted as an entry point in the contextof a wider strategy for womens economic and socio-political empowerment which focuses on genderawareness and feminist organization. As developed byChen in her proposals for a subsector approach to microcredit, based partly on SEWA's strategy and promoted byUNIFEM, microfinance must be:

    part of a sectoral strategyfor change which identifiesopportunities, constraints and bottlenecks withinindustries which if addressed can raise returns andprospects for large numbers of women. Possiblestrategies include linking women to existing servicesand infrastructure, developing new technology such aslabour-saving food processing, building informationnetworks, shifting to new markets, policy levelchanges to overcome legislative barriers andunionisation.

    based onparticipatoryprinciples to build upincremental knowledge of industries and enablewomen to develop their strategies for change (Chen,1996).

    Economic empowerment is however defined in more thanindividualist terms to include issues such as propertyrights, changes intra-household relations andtransformation of the macro-economic context. Manyorganisations go further than interventions at the industrylevel to include gender-specific strategies for social andpolitical empowerment. Some programmes havedeveloped very effective means for integrating genderawareness into programmes and for organizing womenand men to challenge and change gender discrimination.

    Some also have legal rights support for women engage in gender advocacy. These interventionincrease social and political empowerment areseen as essential prerequisites for economicempowerment.

    Poverty Reduction Paradigm

    The poverty alleviation paradigm underlies manNGO integrated poverty-targeted communitydevelopment programmes. Poverty alleviation his defined in broader terms than market incomesencompass increasing capacities and choices adecreasing the vulnerability of poor people.

    The main focus of programmes as a whole is ondeveloping sustainable livelihoods, communitydevelopment and social service provision likeliteracy, healthcare and infrastructure developm

    There is not only a concern with reaching the pobut also the poorest.

    Policy debates have focused particularly on theimportance of small savings and loan provision consumption as well as production, group formaand the possible justification for some level ofsubsidy for programmes working with particularclient groups or in particular contexts7. Someprogrammes have developed effectivemethodologies for poverty targeting and/oroperating in remote areas. Such strategies have

    recently become a focus of interest from somedonors and also the Microcredit Summit Campa

    Here gender lobbies have argued for targetingwomen because of higher levels of female poveand womens responsibility for household well-being. However although gender inequality isrecognised as an issue, the focus is on assistanto households and there is a tendency to seegender issues as cultural and hence not subjectoutside intervention.

    Although the term ' empowerment ' is frequentlyused in general terms, often synonymous with amulti-dimensional definition of poverty alleviationthe term ' women's empowerment ' is oftenconsidered best avoided as being too controverand political8. The assumption is that increasingwomens access to micro-finance will enablewomen to make a greater contribution to househincome and this, together with other interventionincrease household well-being, will translate into

    Gender and micro-finance website: http://www.genfinance.net and http://lindaswebs.org.uk

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    improved well-being for women and enable women tobring about wider changes in gender inequality.

    Financial Sustainability Paradigm

    The financial self-sustainability paradigm (also referred to

    as the financial systems approach or sustainabilityapproach) underlies the models of microfinance promotedsince the mid-1990s by most donor agencies and the BestPractice guidelines promoted in publications by USAID,World Bank, UNDP and CGAP9.

    The ultimate aim is large programmes which are profitableand fully self-supporting in competition with other privatesector banking institutions and able to raise funds frominternational financial markets rather than relying on fundsfrom development agencies10. The main target group,despite claims to reach the poorest11, is the bankable

    poor': small entrepreneurs and farmers. This emphasis onfinancial sustainability is seen as necessary to createinstitutions which reach significant numbers of poor peoplein the context of declining aid budgets and opposition towelfare and redistribution in macro-economic policy.

    Policy discussions have focused particularly on setting ofinterest rates to cover costs, separation of micro-financefrom other interventions to enable separate accountingand programme expansion to increase outreach andeconomies of scale, reduction of transaction costs andways of using groups to decrease costs of delivery.

    Recent guidelines for CGAP funding and best practicefocus on production of a financial sustainability indexwhich charts progress of programmes in covering costsfrom incomes.

    Within this paradigm gender lobbies have been able toargue for targeting women on the grounds of high femalerepayment rates and the need to stimulate womenseconomic activity as a hitherto underutilized resource foreconomic growth. They have had some success inensuring that considerations of female targeting areintegrated into conditions of micro-finance delivery and

    programme evaluation.

    Alongside this focus on female targeting, the termempowerment' is frequently used in promotionalliterature12. Definitions of empowerment are in individualistterms with the ultimate aim being the expansion ofindividual choice or capacity for self-reliance. It isassumed that increasing womens access to micro-financeservices will in itself lead to individual economicempowerment through enabling women's decisions aboutsavings and credit use, enabling women to set up micro-

    enterprise, increasing incomes under their contrIt is then assumed that this increased economicempowerment will lead to increased well-being owomen and also to social and politicalempowerment.

    Conflated paradigms and genderevaporation

    These paradigms do not correspond systematicto any one organisational model of micro-financMicro-finance providers with the sameorganisational form eg village bank, Grameenmodel or cooperative model may have verydifferent gender policies and/or emphases andstrategies for poverty alleviation.

    The three paradigms represent differentdiscourses each with its own relatively consisteinternal logic in relating aims to policies, based odifferent underlying understandings ofdevelopment. They are not only different, but oftseen as incompatible discourses in uneasytension and with continually contested degrees dominance. In many programmes and donoragencies there is considerable disagreement, laof communication and/or personal animosity andpromoted by different stakeholders withinorganisations between:

    staff involved in micro-finance (generally firmfollowers of financial self-sustainability),

    staff concerned with human development(generally with more sympathy for the poveralleviation paradigm and emphasisingparticipation and integrated development)

    gender lobbies (generally incorporating at lesome elements of the feminist empowermenparadigm)13.

    What is of concern in current debates is the waywhich the use of apparently similar terminology empowerment, participation and sustainabilityconceals radical differences in policy priorities.

    Although womens empowerment may be a stataim in the rhetoric of official gender policy andprogram promotion, in practice it becomessubsumed in and marginalised by concerns offinancial sustainability and/or poverty alleviation

    Gender and micro-finance website: http://www.genfinance.net and http://lindaswebs.org.uk

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    ECTION 2. WHAT IS THE PROBLEM? QUESTIONING VIRTUOUS SPIRALS

    There has beenno systematiccross-cultural orinter-organisationalcomparison ofrelative genderimpacts ofdifferent modelsor strategies ofmicro-finance.

    The most detailed studies have been done in Bangladeshand these are currently contested on conceptual,methodological and analytical grounds14. Most studies inLatin America, where there is any consideration of gender

    at all, confine themselves to questions of access or morerarely to the activities in which women are involved. 15TheCGAP-sponsored AIMS studies do not currently containdetailed information on women's empowerment, despitethe commissioning of Chen's framework and some use ofparticipatory techniques. Most other documented studiesare short gender impact assessments commissioned byNGOs and donors which use a diversity of indicators.Most contain limited information on empowerment beyondquestions about increased confidence, control over loans,loan use and more rarely control over income in thehousehold.

    What follows summarises findings of a very diversesecondary source and largely unpublished literature andthe authors own findings from a series of consultanciesworldwide16. Nevertheless, despite its shortcomings theevidence indicates that all the assumed linkages betweenaccess and empowerment need to be questioned asindicated by the questions in italics in Figure 2.

    Questioning Access

    Firstly it is clear that women's access to microfinanceservices have significantly increased over the past twodecades, although in many regions access is still unequalin many programmes, credit unions and village banks. Inparticular loan amounts received by women are generally

    lower than those received by men and this cannbe completely accounted for by demand factorsContinuing gender inequalities in access areparticularly evident in Pakistan (Hussein andHussain 2003).

    Moreover financial indicators of access: womenprogramme membership, numbers and size ofloans and repayment data cannot be used asindicators of actual access or proxy indicators oempowerment. Registration of loans in womensnames does not necessarily mean evenparticipation in decisions about loan application men may simply negotiate loans with maleprogramme staff as an easier way of getting accto credit. High repayment levels by women do nof themselves indicate that women have used thloans themselves. Men may take the loans from

    women or women may choose to invest the loanin men's activities. Loans may be repaid from mearnings, through women forgoing ownconsumption, or from income or borrowing fromother sources17. High demand for loans by wommay be more a sign of social pressure to accessoutside resources for in-laws or husbands thanempowerment (See Bahars Case).

    GRAMEEN BANK, Bangladesh: Baharwasbrought up in a Conservative family and alwaysobserved purdah. The household owned morethan two acres of arable land and Bahar does notqualify for Grameen loans. But, within three to fouyears of the Bank's operation of the village, acouple of women from neighbouring householdsowning arable land, who also officially did notqualify, joined the bank and received loans. Afterthat Bahar's husband insisted that she join theBank and get money for him. Bahar refused.Finally, when insults and other pressure hadfailed, her husband warned her that if she did notoin the Grameen group he would send her backto her natal home and he would remarry. In 1989

    Bahar joined the group and received her first loanUntil 1993, when her husband migrated to Libyaas a manual labourer, the husband used herloans. Now Bahar gives her loans to her brother ia distant village who invests the money in hisbusiness and gives a share of the profit to Baharat the end of each year. Bahar pays the regularweekly instalments from her husband'sremittance. (Rahman 1999)

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    SAVINGS

    AND

    CREDIT

    WOMEN'S

    DECISION ABOUT

    SAVINGS AND

    CREDIT USE

    WOMEN'S

    MICRO-

    ENTERPRISE

    INCOME UNDER

    WOMEN'S

    CONTROL

    WOMEN'S

    DECISIONS ABOUT

    CONSUMPTION

    REPAYMENT

    INCREASED

    STATUS AND

    CHANGING ROLES

    WOMEN'S

    NETWORKS AND

    MOBILITY

    WIDER MOVEMENTS

    FOR SOCIAL

    AND POLITICAL

    CHANGE

    INCREASED

    WAGE

    EMPLOYMENT

    FOR WOMEN

    INCREASED

    INCOME

    ECONOMIC EMPOWERMENT

    INCREASED WELLBEING

    SOCIAL AND POLITICAL

    EMPOWERMENT

    ABILITY TO

    NEGOTIATE CHANGE

    RELATIONS

    IN GENDER

    ?MEN MAY TAKE LOAN

    ?DIVERSION OF LOAN

    ?MEN MAY WITHDRAW THEIR

    INCOME CONTRIBUTION

    ?WOMEN'S DECISIONS MAY REPLICATE

    GENDER INEQUALITY

    ?WOMEN MAY GIVE TO MEN

    ?INCOMES MAY BE LOW

    ?MEN MAY CONTROL INCOME

    ?WOMEN MAY USE

    UNPAID FAMILY

    LABOUR

    ?MAY HAVE

    LITTLE

    IMPACT

    ?MAY REINFORCE

    EXISTING ROLES

    ?WOMEN MAY

    NOT WORK FOR

    WIDER CHANGE

    Fig.1 VIRTUOUS SPIRALS : QUESTIONING ASSUMPTIONS

    IMPROVED

    WOMEN

    WELLBEING OF

    IMPROVED

    CHILDREN

    WELLBEING OF

    IMPROVED

    MEN

    WELLBEING OF

    Gender and micro-finance website: http://www.genfinance.net and http://lindaswebs.org.uk

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    Questioning Economic Empowerment

    In some cases increasesin incomes have beensignificant and there are

    numerous case studiesof successful womenentrepreneurs.

    Most programmesinclude at least one ortwo cases in theirpromotional literature.Some of these womenwere poor, or even verypoor, before receiving aseries of loans18.

    However impact on incomes is widely variable. Thosestudies which consider income levels find that for themajority of borrowers income increases are small, and insome cases negative19. All the evidence suggests thatmost women invest in existing activities which are lowprofit and insecure and/or in their husbands activities. Inmany programmes and contexts it is only in a minority ofcases that women can develop lucrative activities of theirown through credit and savings alone. Although for many

    very poor women decreases in household vulnerabilitymay not have been captured in the studies and may be asimportant as actual increases in income, many womeninterviewed by the author were aiming for significantincreases in their own income.

    It is clear that womens choices about activity antheir ability to increase incomes are seriouslyconstrained by gender inequalities in access toother resources for investment, responsibility fohousehold subsistence expenditure, lack of timebecause of unpaid domestic work and low levels

    mobility, constraints on sexuality and sexualviolence which limit access to markets in manycultures.

    These gender constraints are in addition to marconstraints on expansion of the informal sector resource and skill constraints on the ability of pomen as well as women to move up from survivaactivities to expanding businesses. There are siparticularly in some urban markets like Harare aLusaka, that the rapid expansion of micro-financprogrammes may be contributing to market

    saturation in female activities and hence declinprofits.

    BRAC, Bangladesh: Shiuliis 22 years oldbut looks much older. She is married and hadchildren at an early age. At first she had agood relationship with her husband who was arickshaw mechanic.

    In 1993 she took a loan from BRAC and gavethe money to her husband to improve hisbusiness. However her husband lost much ofthe money to gambling. She became worriedabout the loan repayment and in 1995 wasonly able to repay the loan by selling the tinroof of her house.

    Then her husband left the village and went toDhaka where he married another woman(Khondkar 1998).

    Gender and micro-finance website: http://www.genfinance.net and http://lindaswebs.org.uk

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    Uganda Womens Finance and CreditTrust: Edith Kagino married, with sevenchildren. Before marriage, she developed aninterest in dairy helping her mother. Aftermarriage she worked in her husbands

    orkshop.

    o

    f very well, withe first cow calving normally.

    he

    wFrom 1991 she was a regular saver with

    UWFCT and acquired a loan in 1992, for tw

    in-calf heifers and for the construction of asmall cow shed. She planted napier grass tofeed the cows. Edith started ofthProblems started when her husband

    instructed her to go back to his workshop. Scould no longer take care of the cows, andeventually she lost one of them. Despite herprotestations, her husband insisted that she

    main in the workshop.

    s as his so she was not allowed toke them.

    re

    Eventually her husband chased her awayfrom her home and she had to find shelter forherself and the children. The husband claimedthe cowtaAfter some months, with the help of in-lawthe husband called her back. But healready sold the roofing sheets andconstruction materials of the cowshed and allthe grass was gone. She got pregnant again,then h

    s,had

    er husband decided to live with anotherife.

    marked as a

    wEdith is recovering from the shock, trying tostart again. Her project is

    Questioning well-being and intra-household relations

    There have undoubtedly been women whose status in thehousehold has improved, particularly where they havebecome successful entrepreneurs. Even where incomempacts have been small, or men have used the loan, the

    act that micro-finance programmes have thought womenworth targeting and women bring an asset into thehousehold may give some women more negotiating power.Savings provide women with a means of building up anasset base. Women themselves also often value theopportunity to be seen to be making a greater contributiono household well-being giving them greater confidence

    and sense of self-worth.

    However womens contribution to increased income goingnto households does not ensure that women necessarilybenefit or that there is any challenge to gender inequalities

    within the household. Womens expenditure patterns mayeplicate rather than counter gender inequalities and

    continue to disadvantage girls. Without substitute care formall children, the elderly and disabled, and provision ofervices to reduce domestic work many programmeseported adverse effects of womens outside work on

    children and the elderly. Daughters in particular may bewithdrawn from school to assist their mothers20.

    Although in some contexts women may be seeking toncrease their influence within joint decision-makingprocesses rather than independent control over income

    Kabeer 1998), neither of these outcomes can beassumed. Womens perceptions of value and self-worthare not necessarily translated into actual well-beingbenefits or change in gender relations in the householdSen 1990, Kandiyoti 1999). Worryingly, in response to

    womens increased (but still low) incomes evidencendicates that men may be withdrawing more of their owncontribution for their own luxury expenditure. Men are oftenvery enthusiastic about womens credit programmes, andother income generation out programmes, for this reasonbecause their wives no longer nag them for moneyMayoux 1999).

    Small increases in access to income and influence mayherefore be at the cost of heavier work loads, increasedtress and womens health. Although in many cases

    womens increased contribution to household well-beinghas improved domestic relations, in other cases itntensifies tensions.

    Gender and micro-finance website: http://www.genfinance.net and http://lindaswebs.org.uk

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    Questioning Social and PoliticalEmpowerment

    There have been positive changes in household andcommunity perceptions of womens productive role, as wellas changes at the individual level. In societies like Sudanand Bangladesh where womens role has been very

    circumscribed and women previously had little opportunityo meet women outside their immediate family there haveometimes been significant changes. It is likely that

    changes at the individual, household and community levelsare interlinked and that individual women who gain respectn their households then act as role models for otherseading to a wider process of change in communityperceptions and male willingness to accept changeLakshman, 1996).

    Micro-finance has also been strategically used by someNGOs as an entry point for wider social and politicalmobilisation of women around gender issues. For exampleSEWA in India, CODEC in Bangladesh and CIPCRE inCameroon, indicate the potential of micro-finance to form abasis for organization against other issues like domesticviolence, male alcohol abuse and dowry.

    However there is no necessary link between womensndividual economic empowerment and/or participation inmicro-finance groups and social and politicalempowerment. These changes are not an automaticconsequence of microfinance per se. As noted above,womens increased productive role has also often had itcosts21.

    In most programmes there is little attempt to link mifinance with wider social and political activity. In theabsence of specific measures to encourage this theis little evidence of any significant contribution of mifinance. Micro-finance groups may put severe strainon women's existing networks if repayment becomeproblem (Noponen 1990; Rahman 1999). There isevidence to the contrary that micro-finance andincome-earning may take women away from other

    social and political activities.

    Not only lack of impact but dangers odisempowerment

    The evidence therefore indicates that contributions micro-finance per se to womens empowerment canbe assumed and current complacency in this regardmisplaced. In many cases contextual constraints at levels have prevented women from accessingprogrammes, increasing or controlling incomes or

    challenging subordination. Where women are not abto significantly increase incomes under their controlnegotiate changes in intra-household and communigender inequalities, women may become dependenon loans to continue in very low-paid occupations wheavier workloads and enjoying little benefit.For some women micro-finance has been positivelydisempowering, as indicated by some of the casesshown above which are far from isolated examples:

    Credit (ie debt) may lead to severeimpoverishment, abandonment and put seriousstrains on networks with other women.

    Pressure to save may mean women forgoing thown necessary consumption.

    The contribution of micro-finance alone appearsbe most limited for the poorest and mostdisadvantaged women.

    All the evidence suggests the poorest women are thmost likely to be explicitly excluded by programmesand also peer groups where repayment is the primeconsideration and/or where the main emphasis ofprogrammes is on existing micro-entrepreneurs. It a

    suggests that even where they get access to creditthey are particularly vulnerable to falling further intodebt.

    Gender and micro-finance website: http://www.genfinance.net and http://lindaswebs.org.uk

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    ECTION 3. ESSENTIAL ELEMENTS OF A GENDER POLICY: RETHINKING BESTRACTICE

    t is clear therefore that, although the extent of manyof the problems and negative impacts is unclear, thewidespread complacency about automatic benefits of

    micro-finance for women needs to be questioned.

    At the same time evidence also supports argumentsor the potential of micro-finance to promotoe gender

    equality and womens empowerment. Not onlyhrough targeting women, but gender mainstreamingn micro-finance for men. The experience of currentnnovations in many programmes indicates are aange of ways in which contribution to gender equality

    and womens empowerment can be increased (SeeBox 2).

    The shortcomings of existing practice shouldherefore stimulate the search for improvement andnnovation rather than provide the basis for the cynicalnaction evident in many donor agencies andprogrammes. Some of these measures would entailttle cost, others would require inter-organizational

    collaboration and/or ongoing funding on the basis ofproven developmental impact.

    Underlying vision

    ncreasing the contribution of micro-finance to

    womens empowerment will require firstly muchgreater commitment and coherence in the underlyingprogramme vision. International frameworks forgender mainstreaming, for example the UN ECOSOCefiniition agreed in 1993, distinguishes between:

    Mainstreaming gender considerations in priorities,policies and programmes in order to ensuregender equality of opportunity

    and

    Targeted interventions for womens empowermentto enable them to define priorities and actively

    promote change in their households, communitiesand national and international policy.

    The aim is not to make women and men the same.But women have a human right to equality ofopportunity and this cannot be achieved withoutempowerment. Only then can gender differences andoutcomes be said to be gender equitable.

    BASIC CONCEPTS FOR A GENDERFRAMEWORK

    ECOSOC DEFINITIONMainstreaming a gender perspective is the process

    of assessing the implications for women and men oany planned action, including legislation, policies oprogrammes, in any area and at all levels. It is astrategy for making women's as well as men'sconcerns and experiences an integral dimension inthe design, implementation, monitoring andevaluation of policies and programmes in all politiceconomic and societal spheres so that women andmen benefit equally and inequality is not perpetuateThe ultimate goal is to achieve gender equality (p2)ECOSOC MAINSTREAMING FRAMEWORK

    Mainstreaming practicerequires more than designingand implementing add-on projects for women.Currently, United Nations development entities thatactively address gender issues in their work, in generaltake a two-pronged approach:(a) mainstreaming gender considerations in

    priorities, policies and programmes and(b) targeting women as participants and/orbeneficiaries through women- and girl-specificprogrammes.

    GENDER EQUALITY OF OPPORTUNITY: eliminationof those differences which perpetuate unequal power anresources and ascribe lower value to women's choices.may also be used to refer to those more limited areaswhere mens choices and access to power and resourceare limited. Gender is no longer a basis for discriminatioand inequality between people.WOMENS EMPOWERMENT: is the participatoryprocess through which women, who are currently mostdiscriminated against, achieve gender equality andequity. Where the extent of women's disadvantagemeans that they are unable to fully promote their owninterests, this will require support by developmenagencies at household, community and macro levels.This will include support for men to change thoseof their behaviour, roles and privileges which cudiscriminate against women.

    t

    aspecrrently

    GENDER EQUITY OF OUTCOMES: whereby, based oequality of opportunity and empowerment women andmen may make different, free and realisable life choicesIn a gender equitable society both women and men enjoequal status, rights, levels of responsibility, and access power and resources. This enables them to make their

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    UNDERLYING PROGRAMME VISION

    GENDER EQUALITY

    womens equal access to micro-finance andemployment to be seen as a human rights issueand an integral part of any mainstream regulatorand policy framework

    separation of gender from poverty concerns withexplicit strategies for addressing gendered reso

    and power inequalities within households andcommunities and explicit strategies for the mostdisadvantaged women

    mainstreaming womens concerns includingattention to reproductive work, vulnerability andwellbeing not as womens projects but as integparts of any economic intervention for women amen

    EMPOWERMENT

    explicit and adequately resourced strategies for

    womens empowerment

    from women to gender: women's empowermerequires not only strategies targeting women bualso strategies to support men in challenginggender inequality

    The implications for micro-finance of this definition andramework, to which most donors and governments areignatory, are significant. It implies that differences in

    women and mens use of micro-finance services, andifferences in outcomes cannot be assumed to be gender

    equitable unless there is complete equality of access andactive empowerment policies to support women inchallenging inequality.

    Although womens equal access to all micro-financeervices is essential, providing an adequate and non-iscriminatory regulatory framework needs to be seen as aundamental human rights issue, and an integral part ofulfilling the demands of the Micro-Credit Summit

    Campaign, rather than the end aim of gender policy itself.Even this narrower aim of increasing access itself requiresmore critical examination of underlying assumptions aboutgender differences in rights, responsibilities and rolesnderlying definitions and policies aimed at the

    household, community, entrepreneur, farmer to

    explicitly include womens concerns in malestreampolicy. These assumptions affect womens access toprogrammes, the types of services they are offered and theegree to which they are able to benefit.

    There is also a need to separate womens empowermentssues from poverty concerns.

    On the one hand, intra-household inequalities meanthat women do not necessarily benefit from increasesin household income, even where they are majorcontributors. It is not therefore sufficient to target

    policies solely at the household level, programmes alsoneed to address inequalities within the household.

    On the other hand, differences between women meanthat empowerment strategies do not necessarily reachthe poorest women and/or may be differently definedby them. 'Women' cannot therefore be treated as anundifferentiated category and specific strategies maybe needed for the poorest and most disadvantagedwomen.

    n view of the interlinked and mutually reinforcing nature ofifferent dimensions of gender subordination, gender

    maintreaming requires integration of productive andeproductive work, welfare and vulmnerability concerns

    not as separate (underresourced) womens projects butntegral parts of economic interventions for women andmen.

    The underlying vision for gender policy needs to go muchurther than either access or household-level poverty

    alleviation and focus on strategies which positivelyempower women and transform gender relations foequitable development processes and outcomes.

    Importantly both gender equality and womensempowerment imply not only strategies targetingwomen, but also strategies targeting men. Femaletargeting may simply make women responsible forrepayment of men's loans and household savings,which may come from their own basic consumptionexpenditure and also make them very vulnerable incases of marital breakdown. Programmes need toacknowledge the potentially negative effects on genrelations of targeting women. This does not howeveimply malesteam business as usual but activeconsideration of ways in which strategies for men ca

    challenge and change those gender inequalities whcurrently disadvantage women.

    Gender and micro-finance website: http://www.genfinance.net and http://lindaswebs.org.uk

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    Micro finance products

    The design of micro-finance products e.g. interest rates,epayment schedules, application procedures, loan size

    and purpose and savings conditions are often seen as aechnical banking issue decided from above by programmetaff. The main consideration is financial self-sustainability

    or more rarely poverty targeting. Very little attention has

    been given to empowerment questions. However,evidence indicates that womens ability to use micro-nance to increase incomes and control these incomes are

    also affected by details of the conditions of micro-financeelivery.

    Current debates have been pre-occupied with the issue ofetting interest rates high enough to cover costs of service

    provision. It is often asserted that the actual level ofnterest is not of great concern to borrowers provided theyare lower than those charged by moneylenders. Interestates charged by womens groups like ROSCAs on their

    own funds are frequently higher than those charged byMFIs. Low or subsidised interest rates may distort marketprices for borrowers products and/or inputs as tradersemand their cut and may also lead to substantial '

    eakage to the better-off and corruption. However whileboth the above are true, the importance of interest ratesepends partly on who is perceived as benefiting from

    high interest rates (in ROSCAs it is members, in MFIs it isprogramme staff or donors). It also depends on the degreeof profitability of local enterprises as interest paymentshave to come out of profits and/or consumption. Contraryo current assertions in some of the literature, research by

    he author in Bangladesh indicates that levels of interestate are significant in detering many poor women fromaking loans. The current complacency about the levels ofnterest which may be charged is therefore misplaced,particularly in programmes accessing development fundsclaiming to maximise contribution to poverty alleviation andempowerment.

    Equally as important as interest rates are repaymentchedules and methods of interest calculation. These

    have a critical impact both on women's ability to profitablyse loans and their ability to control both loans and

    ncomes. In many programmes these are fixed in anarbitrary manner with little consultation, often because ofeplication of particular models from other contexts. Theepayment schedules and methods of interest calculation

    prefered by women however varies between context andype of programme. For example in CODEC in Bangladeshshworker women preferred declining balance repayments

    because it enabled them to immediately pay back anymoney they earned and prevent this being diverted into

    other purposes by their husbands. Interest rates wecalculated quickly on a calculator in front of borroweby programme staff whom they trusted. Othermechanisms also ensured against corruption. In CGin Cameroon on the other hand women prefered fixrate interest which they could calculate themselves

    MICROFINANCE PRODUCTS

    GENDER EQUALITYIntegrating womens needs and concerns into produdesign so that they have equality of access to allproducts

    ark

    es

    removing all gender discrimination in loans egcollateral and guarantor requirements whichdisadvantage women

    application and promotion procedures to equallytarget womens information networks and locationand times accessible by women

    repayment schedules and interest rates to reflectreality of womens economic activities and life cyc

    ensuring women have equal access to largeindividual loans and incorporating clear strategiefor womens graduation to larger loans

    improving savings facilities and promotion for merange of savings facilities including higher interesdeposits with more restricted access to increase

    womens assets

    EMPOWERMENT

    repayment schedules and interest rates to maximimpact on incomes

    registration of assets used as collateral orpurchased with loans in womens names or in jonames and applicable in both loans for women amen

    active and preferential promotion of loans to wofor new activities on condition of asset registratiotheir names and proof of their active involvemen

    active and preferential promoition of loans towomen for house and land purchase and markeregsitration costs on condition of asset and msite registration in their nam

    loans to reinforce and strengthen maleresponsibilities for household well-being, includithat of their wives and daughters e.g. loans fordaughters education or to purchase a productivasset for unmarried girls

    Gender and micro-finance website: http://www.genfinance.net and http://lindaswebs.org.uk

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    hey were more familiar with fixed rate interest in their ownROSCAs and groups were expected to take on the burdenof loan repayment without individual staff supervision. InCGT case studies of patterns of loan use and profitsndicated that inflexible disbursement procedures andepayment schedules had an adverse effect on profits from

    womens activities. Again this also has potentially adversemplications for repayment rates. Flexibility to women'sneeds does not mean being soft on default. It is possible,

    as in the case of CODEC, to fix repayment schedules withborrowers and reward or penalise performance the relationo be agreed schedule. This also encourages borrowers toake a more strategic approach towards loan use, itself anmportant contribution to increasing womens skills andoan ownership.

    One of the central emphases in proposals for best practicen the financial sustainability approach to facilitate poverty-argeting and increasing womens access has been

    changes in collateral requirements. This has includedacceptance of female-owned assets and social collateral

    n the form of womens group guarantees as discussedbelow. Changes in collateral requirements to facilitatewomens access to micro-finance are explicitly mentionedn CGAP recommendations. However the issue of femaleownership of assets has so far received little attention inpractice. In some programmes women continue to needheir husbands signature to apply for loans. In some casesincluding some of the very same programmes) by contrast

    men are able to cite their wifes property as collateral formale loans without their wifes consent.

    The question of loan size has received considerable

    attention in the literature. It is generally asserted thatwomen need smaller loans, and this is certainly true fornitial access and for poor women. However there is aanger of ghettoizing women in small loans and there is

    also evidence of prejudice by male staff against grantingarger loans to women. Larger loans which enable womeno enter more lucrative activities are cheaper to administer.

    An effective loan graduation programme for women wouldherefore have financial sustainability benefits. Largeroans could be made conditional on registration of assetsn womens or joint names and evidence of womensnvolvement in the loan activity, including marketing and

    accounting and production of business plans. Again thesen themselves could give women more confidence andkills in taking a strategic approach to savings and loansather than simply drifting into debt.

    There is some disagreement about the degree to whichoans can or should be directed towards particularpurposes. For poor households production andconsumption are inextricably interlinked and experience

    has shown that many attempts by programmes todirect loans are ineffective and costly. Howeverresearch by the author in CODEC in Bangladeshwhere women were carefully guided in their activitieinitial stages of programme membership said thatwithout such support they would be unable to useloans for their own activities and the loans and incowould be taken by men. They were therefore opposto moves to reduce this monitoring advocated in

    guidelines for Best Practice produced by the donor.Such close monitoring may not be necessary inprogrammes targeting existing female entrepreneurand where gender norms give women control overmuch of their own income because of responsibilityhousehold subsistence, as is the case in much of

    Africa and South East Asia. Nevertheless women owant assistance in improving and diversifying incomsources and support in protecting their incomes frompredation by husbands. Another way round theproblem of loan diversion is also to offer loans to bomen and women for specific types of consumption.

    Some programmes offer loans to both men and womfor children's education, house improvement etc.Ensuring the availability of loans to men for particulatypes of consumption eg daughter's education, schofees in general, health care, and house improvemencould serve to reinforce men's responsibility for theihouseholds. This is particularly the case whencombined with joint registration of assets, or assetsregistered in the wifes name.

    For some advocates savings programmes are seenmore important than credit, and savings programme

    risk becoming the next magic bullet for those scepabout credit. For many women, including very poorwomen, savings facilities are as important in increasamounts of income under their control as are loanssome contexts women appear to prefer compulsoryvoluntary savings as a means of ensuring their abilito protect incomes against the demands of husbandNevertheless it is important to realize firstly that wommay already have a range of effective ways of savinand NGO savings programmes may be imposing a efficient way of saving on women, particularly wheresavings are a condition of loans. Savings programm

    may also detract resources from indigenous savingsgroups which often provide a safety net for very poowomen from the funds of other group members e.g.trouble funds in West Africa. Secondly, savings foregone investment and/or consumption and maytherefore harm both women's ability to increase proor their nutrition and health. Women's own needs anexisting strategies therefore must be carefullyexamined before designing any savings programme

    Gender and micro-finance website: http://www.genfinance.net and http://lindaswebs.org.uk

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    s particularly important that women do not become solelyesponsible for saving within the household leaving men'sesponsibilities and contributions unquestioned. There is aanger that some Savings and Credit Cooperatives,

    particularly where women are the main savers butnderrepresented as borrowers and on decision-making

    bodies, perform the rather dubious function of recyclingpoor womens savings as low-interest loans to (oftenbetter-off) men.

    Share purchase has been seen by some as a means ofncreasing member ownership of programmes. GrameenBank prides itself on being largely member-owned.However share purchase may be little more than anotherway of charging members to borrow money which has theadded advantage of not being included in the interest rate.The relationship between share ownership and programmeownership depends very much on the rights which shareholders have in the decision-making process. There is nonecessary relationship between share ownership andempowerment.

    Non-financial services

    Financial sustainability requirements of cutting costs to aminimum has led many programmes to separate, and inhe process drastically cut, non-financial services. In the

    past some support services in some programmes,ncluding business training and gender awareness, havebeen both expensive and had minimal impact. Howeverhis does not mean that non-financial services are not

    needed or would not make a substantial contribution to allaspects of empowerment (and also to repayment rates) ifhey were better designed. For many women, and men,hey are essential to helping them make most benefit fromnancial services.

    The issue is therefore how to make such services moreeffective, cost-efficient and sustainable. There are a rangeof ways in which these aims can be better achieved :

    fully integrating gender concerns into client\memberand staff training would entail costs in the short term toredesign courses but these costs would be minimal in

    the longer term

    mutual learning and information exchange by womensgroups could meet many basic training needs ifsystems are properly set up and funded initially

    cross-subsidy from charging better-off clients(including men) for some services, particularlybusiness services, business registration etc.

    inter-organisational collaboration between microfinance programmes and specialist providers ofother types of service. This could take the form advertising availability of other services eg advicand information about legal rights from localwomens movements, referring clients orprogramme/group/ individual payment for particuservices. It could also take the form of sharingcosts of developing innovations or research.

    Firstly womens perspectives and needs must be fuintegrated into all training and social and infrastructprovision. Gender awareness is obviously central toany empowerment strategy but is often one of the fithings to be cut under pressure for financial self-sustainability. Gender awareness may in fact be moeffective when fully integrated with other programmeservices for both women and men e.g. allorganisational training, skills training etc.

    This includes a broadening of many business trainprogrammes to include gender issues in householddivisions of unpaid labour and budgeting. Many trainprogrammes assume self-employed mens ability tboth command unpaid family labour and have

    NON-FINANCIAL SERVICES

    GENDER EQUALITY

    integration of gender awareness and womensinterests and concerns into all training

    programmes and design of all non-financialservices for women and men

    services for both women and men: services toreduce burden of unpaid domestic work,including childcare.

    EMPOWERMENT

    gender specific services for women egtraining/mutual learning for women to increasorganizational as well as business skills, legalaid support.

    linking with other services providers eg for legaid, training, gender research

    actively promoting and networking with otherorganisations challenging gender inequality,including womens movements and mensmovements for change

    Gender and micro-finance website: http://www.genfinance.net and http://lindaswebs.org.uk

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    absolute control over income, rather than encouraging co-operation within the household and equal distribution ofights andresponsibilities. This would also cut costs once

    additional changes to training programmes have beenmade. In women-only programmes it is obviously moreifficult to include men. But some programmes, e.g.

    BERDSCO in Cameroon, invite men along to some of thewomen's training programmes where gender awareness isncorporated with skills and other training. Similarly,

    ensuring women's equal access to and role in design of allervices provided by the organisation e.g. health, literacy

    may be more important and cost-effective than treatinghese as separate women's programmes, although someorms of separate provision within the mainstream

    programme may be needed.

    At the same time, there is a need for certain gender-pecific services in particular womens rights training22 for

    women (and also men), legal and other support for womenwith particularly difficult household situations. Women mayneed special training and/marketing support to enable

    hem to increase incomes and control over incomesncluding access to new or male economic activities.23There is also a need for support to decrease the burden ofnpaid domestic work, including childcare, that should also

    encourage men to take some responsibility for these tasks.

    There is also a need to rethink current orthodoxy on theeparation of micro-finance from other interventions. Thiseparation has been based on perceptions of a role

    conflict for staff between hard-nosed debt collection andsoft social development functions, and the need toeparate these functions in order to calculate the financial

    ustainability index required by CGAP. In practice this hasoften meant the cutting, or at best underfunding, of trainingand other services. The separation of training alsogenerally reduces it to a one-off event with no follow-upand hence impact is often reduced. Moreover whereepayment incentives are inbuilt into credit delivery, theres a useful complementarity of micro-finance and otherhuman development and empowerment interventions.This was the experience of CODEC and CIPCRE whereeparating credit and savings delivery from humanevelopment activities would have been more costly and

    had less impact, at least in initial stages of group

    evelopment. It is therefore debatable whether cost-effectiveness should be sacrificed for ease of accounting,and in any case separate accounting is possible withouteparation of functions. Ways of building on such

    complementarity need to be developed rather thanndermined as is happening in many programmes at

    present.

    Any or all of these means could be combined toincrease cost-effectiveness over time eg initialassessment of needs and self-help possibilities,applying for donor funds to develop these thenintroducing service charges for the better-off or nonmembers at a later date. Other complementaryservices may need to be treated as ongoingcommitments by donors outside the financialsustainability equation funded from micro-finance

    services themselves. It may also be necessary ifservices are to meet the needs of very poor women

    It is crucial that micro-finance programmes thinkthrough the range of support needed by women forempowerment, identify the potential contribution oftheir particular expertise and organisational contexand link strategically with other forces for changeincluding womens own networks, womens movemand advocacy organisations and gender lobbies widonor agencies. Development of training courses cobe done by pooling the resources of several

    programmes. Programmes could also link with othespecialist providers of other types of service. This ctake the form of advertising availability of otherservices eg advice and information about legal rightfrom local womens movements, refering clients orprogramme/group/ individual payment for particularservices. It could at a minimum entail drawing up aof such organizations and agreeing to keep theirpublicity material at loan disbursal points, or makinglist of possible speakers available to groups. Thiswould both increase the contribution of micro-financminimum cost and give service providers ready acc

    to a sizeable and organized constituency of poorwomen, which would in turn also contribute to theirsustainability.

    Group structures and functions

    Most microfinance programmes targeting women argroup-based. In many programmes group-basedservices offering small loans are targeted to womenalongside another programme giving larger, individuloans where the majority of borrowers are men. Groare viewed as a means of reducing costs throughpassing on some of the responsibility for borrowerselection, loan disbursement, monitoring andrepayment onto groups. Group formation is furtherassumed to be inherently empowering for womenthrough bringing them together. However female-targeted group-based microfinance where the mainis to reduce the costs of service delivery risks furthe

    Gender and micro-finance website: http://www.genfinance.net and http://lindaswebs.org.uk

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    einforcing women's role as cheap conduits for loans tomen who have neither the time nor the inclination to attendgroup meetings. There needs to be a change of emphasisrom viewing groups simply as a repayment mechanism toooking at ways of building on social capital (Mayoux999b) through facilitating groups to develop their own

    empowerment strategies and linking them with women'smovements and other organisations.

    There is an important role for groups as a forum fornformation exchange and mutual learning betweenwomen. This includes for example successful womenentrepreneurs within programmes sharing theirexperiences with others, skills exchange. Both SmallEnterprise Foundation in South Africa and CARE-PROSPECT in Zambia are developing ways of using PLAmethods to facilitate information exchange. In CGT forexample interviews with groups found that many womenwould be prepared to help train other women and groupswould be prepared to pay for such training. This wouldequire programmes to play a facilitating role eg collecting

    nformation on training needs and training skills as part ofprogramme registration and compiling this into a register inhe Management Information System. A programme tryingo set up a comprehensive system for this is LEAP in

    Sudan.24

    Savings and credit groups also provide an acceptableorum for women to come together to discuss gender

    issues and organised for change. For examplewomens groups in Zambuko had spontaneouslyinvited a woman to give talks on how to manage yohusband and mother-in-law. However this was in tcontext of programme where many women were alsmembers of other women's organizations and the swere empowerment-focused. Questioning of genderoles does not happen automatically, and women mneed considerable support particularly in the form o

    information, organisational and leadership skills, analso in the actual strategies they decide to employ.Women interviewed by the author in CODEC wherewomen's groups have received women's rights trainand leadership training were extremely positive aboits contribution to their ability to bring about changewithin the households and communities in relation tissues like domestic violence and divorce.

    GROUP FUNCTIONS AND STRUCTURES

    GENDER EQUALITY

    ensuring that group structures actively promotewomen to take an equal part in leadership

    ensuring that group processes actively promotewomens participation in discussion and allow atleast equal space for discussion of womensinterests and concerns

    ensuring that decision-making processes give atleast equal weight and importance to womensinterests and concerns

    EMPOWERMENTbuilding on groups as an organisational basis for

    a structure for mutual learning and informationexchange between women and between womenand men

    collective action by women

    mobilising male support for change in genderrelations.

    It is also important to include men in this process toavoid unnecessary conflict and enable women to bemore open about their needs and aspirations. Male

    support needs to be encouraged through developmof new role models and developing male networks fchange. There are significant opportunities for chain mixed-sex programmes where male staff are alsoworking on gender issues with men and women areable to take their concerns before a male organizatiSome mixed sex programmes like CODEC inBangladesh and CIPCRE one of the partnerorganisations of CGT had been very effective inorganising men alongside women to address issuesdomestic violence and abandonment of women. Agin women-only programmes it is obviously more diff

    to include men. Kashf in Pakistan promised tointroduce a mens loan program later if the men'ssupported the women's programme first. Men couldalso be invited to some of the women's meetings,provided they do not dominate.

    Microfinance programmes also provide a potentiallylarge and organised grassroots base for developingadvocacy and lobbying strategies around genderissues. SEWA and other NGOs in India haveeffectively linked women in micro-finance groups towider organizations for lobbying and advocacy.

    Organizational gender mainstreaming

    It is extremely difficult for an organization which aimpromote gender equality and empowerment if itpractices gender discrimination within the organizatIt must walk the talk.

    Gender and micro-finance website: http://www.genfinance.net and http://lindaswebs.org.uk

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    Evidence indicates a clear linkage between contribution towomens empowerment, and even womens access to

    micro-finance, and levels of female staff. In many othercontexts, even those where men are able to talk freely towomen, there are many issues related to gender inequalityand discrimination which women would not be able or wisho discuss with men.

    This is not to say that male staff cannot have goodelations with female clients. Male staff are also key in

    contacting and changing the attitudes of men within the

    community. At the same time although it is obviouslthe case that male staff may be very gender-aware supportive, it is generally only where there is a critmass of women in positions of sufficient authoritywithin organisations that gender issues become fullintegrated into malestream programmes andimplemented.

    ORGANIZATIONAL GENDER MAINSTREAMING

    o:

    provide the organizational skills and capacity forpromotion of gender equality and empowerment

    promote an empowerment perspective throughout theprogramme interactions with programme participantsincluding all conditions of micro-finance delivery, allroutine training and advice for both women and men

    and complementary services and all group activitiesas a human rights issue for female and male staff

    GENDER EQUALITY

    gender awareness requirements as an integral part ofall job descriptions and recruitment requirements in thesame way as attitudes to other dimensions of socialdiscrimination like race and religion

    equal opportunities policies for staff, including equalrights to promotion, pay and benefits and family-firendly working practices for both women and men

    gender and empowerment awareness and genderskills training for all male and female staff to providean equitable working environment for both womenand men as an integral part of staff skills development

    WOMENS EMPOWERMENT

    active promotion of women to leadership positionsuntil gender equity is reached

    ensuring specialist gender skills to work with bothwomen and men from a gender perspective areavailable and coordinated from within the organisationor through close collaboration with other organisations

    concrete incentives for womens empowerment inprogramme implementation including incentives forwomen themselves, for male participants and maleand female staff

    integration of empowerment indicators into existingprogramme MIS

    Equal opportunities is likely to require quite profoun

    changes in recruitment criteria, organizational cultuand procedures in many programmes. Enablingwomen to join the organization and take up promotipossibilities will require changes in institutional cultuand also introduction of more family friendly workingpractices. These would also enable male staff to fultheir own duties and responsibilities towards theirfamilies.

    A distinction needs to be drawn between:

    gender awareness or commitment to promotio

    gender equality and empowerment andspecialist gender expertise which requiresspecialist training like anyo other expertise likefinance or technology

    The former should be a prerequisite for recruitment the organisation on the same way as other attitudesrace and religious discrimination are taken into accoin promotion. Gender awareness needs to be fullyintegrated into all staff training for women and men an integral part of their skills development. This gentraining needs to identify priorities for gender policy

    client level and how women's participation can beincreased at all levels. It also needs to identifynecessary changes in organizational culture,recruitment criteria and procedures to ensure equalopportunities becomes a reality at work, and also toenable female and male staff to overcome the manygender challenges they face in their lives outside wo

    Structures for implementation of gender policy needgo beyond appointment of a junior member of staff gender officer and/or allocating a small percentage time from different staff. There need to be clear lineresponsibility, adequate resources and forums forexchange of information and ideas. These in turnrequire clear guidelines and concrete incentives forimplementation of empowerment policies if bothwomen and men staff are to feel confident aboutspending scarce time and resources on these issuePossible staff incentives would have to be piloted atested with client groups and staff but targets could things like eg numbers of women entering non-

    Gender and micro-finance website: http://www.genfinance.net and http://lindaswebs.org.uk

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    raditional and well-paid economic activities, numbers ofSHGs taking collective action, success in particular areasof gender lobbying. Incentives could include staff prizes,aking these considerations into account in promotion or

    offering bonuses.

    Finally creating these incentives in turn requires integrationof empowerment indicators into programme monitoring andevaluation to assess the impacts of programmes on the

    ves of programme participants, and also to assess thepotential contribution of programmes to empowerment.Achieving financial sustainability and fulfilling donoraccounting procedures require sophisticated managementnformation systems (MIS). However these are costly tontroduce, require skilled staff to maintain and are onlysed to collect and manipulate financial data. The

    ntroduction of MIS however offers an opportunity to alsontroduce systematic impact monitoring which can be usedn both programme planning and staff management. SEFn South Africa has been looking at cost-effective ways ofoing this for poverty (Mayoux and Simanowitz 2000) and

    hese methodologies could also be further developed tonclude empowerment indicators (Mayoux 1998b).

    The conflation of paradigms, coupled with continuingesistance to anything more than lip-service to gender

    mainstreaming in most programmes and donor agenciesmeans that even with recent moves within CGAP and theMicrocredit Summit Campaign to pay more attention topoverty targeting continue to marginalise gender issues.Accompanying the rapid increase in womens access tomicro-finance has been a progressive narrowing of theefinitions of empowerment and decrease in funding for

    explicit strategies to achieve it.

    There is a need to promote a much more diversified micro-nance sector than that implied by current Best Practice.

    The evidence seriously calls into question the universalesirability of separate MFIs along the standard Grameen,

    ACCION or village-banking model as described in theeplication literature. Women need a diversity of provision,

    both in view of their own individual needs for different typesof savings, loans, insurance, pensions etc and in view ofifferences in needs between women.

    Given donor commitment to gender mainstreaming genderequality should be an integral criterion for funding

    decisions alongside any other requirements forsustainability or proven development contribution.

    Women are not a minority but a marginalisedmajority

    amongst micro-finance clients and potential clients.The gender equality measures outlined in this papecan be implemented in any model of micro-finance

    from gender mainstreaming in private and public sebanks and other financial service providers to smallmicro-finance programmes providing specialisttargeted savings and credit through to womensmovements and labour organizations organizing sehelp groups.

    The empowerment strategies suggested can also bimplemented in many different organisational modePromoting empowerment requires a significant chanin attitude, changes in working practices andchallenging vested interests. Flexibility to womens

    needs and deciding the best ways of combiningempowerment and sustainability objectives can onlydone on the basis of extensive consultation withwomen, research on womens needs, strategies andconstraints and a process of negotiation betweenwomen and development agencies. There is therefa need to develop effective structures for participatomanagement which combine requirements of efficieservice delivery and contribution to empowerment.

    SECTION 4: BEYOND BLUEPRINTS:MEETING THE CHALLENGE

    What is worrying in the current situation is thatenthusiastic assumptions of automatic beneficial

    impacts of micro-finance are being used as a pretexfor withdrawing support for other empowerment andpoverty alleviation measures, including support forsubsidies for programmes targeting the poorest andempowerment strategies within micro-financeprogrammes themselves. Then in response tomounting evidence of potentially limited contributionpoverty alleviation and empowerment donors areresponding by saying that issues of empowerment awelfare need to be treated separately from micro-finance, despite the diversion of funds from theseseparate strategies. There is therefore a need to

    develop effective strategies for networking betweenmicro-finance programmes and other organisationsworking for change in order to challenge donorpressure and address the macro-level constraints othe empowerment contribution of micro-financeprogrammes themselves.

    Gender and micro-finance website: http://www.genfinance.net and http://lindaswebs.org.uk

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    ENDNOTES

    This paper is based on work originally funded by DFID, theOpen University, Milton Keynes, UNIFEM and ILO (Mayoux998a, 2000, 2002). Since that date many of the case studies on

    which it is based have been published on the website of OneWorld Action, UK as a resource for the Micro Credit Summit +5meeting in New York November 2002 www.oneworldaction.org.More detailed examples of innovation in Africa and India are

    vailable in Mayoux 1999. 2000 and Mayoux ed 2002a,b. Detailsf ways forward specifically relating to impact assessment cane found in the authors paper on Microfinance on the DFID

    Enterprise Impact Assessment Information Service websitewww.enterprise-impact.org.uk.

    Consultative Group to Assist the Poorest is a majornternational collaborative initiative arising from the 1993nternational Conference on Actions to Reduce Global Hungernd was formally constituted in 1995. The nine founding

    members are Canada, France, the Netherlands, the UnitedStates, the African Development Bank, the Asian DevelopmentBank, the International Fund for Agricultural Development, theUnited Nations Development Programme\