Making Poverty into a Financial Problem: From Global Poverty Lines to Kiva.org (original) (raw)
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The financialisation of poverty
Human Rights Documents Online
This book helps to understand the enigmatic microfinance sector by tracing its evolution and asking how it works as a financial system. Our present capitalism is a financialized capitalism, and microfinance is its response to poverty. Microfinance has broadranging effects, reaching hundreds of millions of people and generating substantial revenues. Although systemic flaws have become obvious, most strikingly with the 2010 Indian crisis that was marked by overindebtedness, suicides and violence, the industry's expansion continues unabated. As Philip Mader argues, microfinance heralds less the end of poverty than new, more financialized forms of poverty. While microfinance promises to empower, it generates discipline and extracts substantial resources from the poor, producing new crises and new forms of dispossession. Version: Author's own version of their pre-copy-edited contribution.
The Financialization of Poverty
Palgrave Macmillan UK eBooks, 2015
This book helps to understand the enigmatic microfinance sector by tracing its evolution and asking how it works as a financial system. Our present capitalism is a financialized capitalism, and microfinance is its response to poverty. Microfinance has broadranging effects, reaching hundreds of millions of people and generating substantial revenues. Although systemic flaws have become obvious, most strikingly with the 2010 Indian crisis that was marked by overindebtedness, suicides and violence, the industry's expansion continues unabated. As Philip Mader argues, microfinance heralds less the end of poverty than new, more financialized forms of poverty. While microfinance promises to empower, it generates discipline and extracts substantial resources from the poor, producing new crises and new forms of dispossession. Version: Author's own version of their pre-copy-edited contribution.
Micro-finance and the Poverty Question: A Historical Perspective
Journal of Insurance and Financial Management, 2017
The pivotal emergence of micro-finance is a function of gross insensitivity of conventional finance sector to reach the overwhelming population of the poor and to assist in the drive to manage poverty. Micro-finance movement has captured the imagination of academics, policymakers, and practitioners in terms of provision of financial means to access credit, and start small businesses, with the potential to enhance community, local and national development. When micro-finance is adequately harnessed and supported, it could scale-up beyond the micro-level as a sustainable part of the process of economic empowerment by which the poor could lift themselves out of poverty. Poverty is a multi-dimensional problem, embedded in a complex and interconnected political, economic, cultural, and ecological system. Owing to poverty's large scope and multiplicity of actors, there is no single guaranteed approach to its management. As a result, solutions are as multifaceted as the causes. Problems and solutions are not isolated phenomena, but occur within an interconnected system in which actors and actions have reciprocal consequences. The greatest contribution of micro-finance is that it empowers people, by providing them with confidence, self-esteem, and the financial means to play a larger role in their development. The potential of micro-finance far exceeds the micro-level, scaling-up to address macro-problems associated with management of poverty.
Microfinance in a developed welfare state: A hybrid technology for the government of the outcast
2014
Although microfinance is often thought of as a tool to address poverty in developing countries, it is also being introduced in a number of countries in the developed world. The paper presents a qualitative study of the first year of the introduction of microfinance to address vulnerable groups in Sweden. Savings banks and nonprofit organisations collaborated in the introduction of microfinance as microcredit for micro-enterprise. The paper argues that the rationalities behind actors' participation in microfinance differed, with banks adopting a market rationality and nonprofits mainly a rationality of community empowerment. In line with a governmentality approach, the paper argues that the neoliberal market rationality dominating microcredit for micro-enterprise colonises the space of the communitarian aspect by turning the social into the personal. The paper's qualitative approach complements a governmentality analysis by highlighting the everyday resistance to the neoliberal financialisation of inclusion efforts.
Economic Research-Ekonomska Istraživanja, 2013
Microfinance serves as a key case for studying the effects of financial systems. As a development intervention deeply intertwined with processes of financialisation, we study the expansion and workings of microfinance on three dimensions. First, microfinance's appeal is built on positive mobilising narratives which present poverty as a problem of finance, and portray it as superior solution relative to charity or other redistributive alternatives. Second, microfinance as a financial system exerts a governmentality which works through technologies of the selffor disciplinary individuals to uphold regularity in capital flows. Third, in this way microfinance makes possible the extraction of surplus value from its poor borrowers, who may not have much choice, at a considerable scale. We conclude that these three dimensions help to explain the ways in which financial systems overall operate and expand. Reference to this paper should be made as follows: Mader P. 2013. Explaining and quantifiying the extractive success of financial systems: microfinance and the financialisation of poverty. Ekonomska istraživanja-Economic Research Special Issue 2013
Microfinance in a developed welfare state: A hybrid technology for the governance of the outcast
Geoforum, 51: 27-36., 2014
Although microfinance is often thought of as a tool to address poverty in developing countries, it is also being introduced in a number of countries in the developed world. The paper presents a qualitative study of the first year of the introduction of microfinance to address vulnerable groups in Sweden. Savings banks and nonprofit organisations collaborated in the introduction of microfinance as microcredit for micro-enterprise. The paper argues that the rationalities behind actors’ participation in microfinance differed, with banks adopting a market rationality and nonprofits mainly a rationality of community empowerment. In line with a governmentality approach, the paper argues that the neoliberal market rationality dominating microcredit for micro-enterprise colonises the space of the communitarian aspect by turning the social into the personal. The paper’s qualitative approach complements a governmentality analysis by highlighting the everyday resistance to the neoliberal financialisation of inclusion efforts.
Microfinance north and south: contrasting current debates
Journal of International Development, 1998
This paper sets out to examine the apparent consensus around microfinance as a tool to address poverty and social exclusion in North and South. The current emphasis on scale and sustainability in Southern microfinance practice fits the 'counter revolution' in development thought but contrasts with the origins of community banking in the North. The roots of the latter lie in a critique of mainstream economic and financial systems and seeks to re-invent them in ways that bring social, economic and environmental costs and benefits into focus. The role of microfinance in building sustainable livelihoods, both economic and social, is then examined. Finally, it is suggested that, as with any intervention, microfinance has no inherent capability to address gender inequities but must be deliberately made to do so.
Microfinace As An Instrument Against Poverty
Journal of Global Economics, 2017
The objective of the current approach is to set out how microfinance institutions (MFIs) are incentives for economic development and as sources of lowering poverty. In this respect, a sample of 197 new and old clients having recourse to MFIs is targeted. The discriminant descriptive analysis which is proposed in this article is useful for mainly meeting the results that microfinance has a highly significant effect on improving people's standards of living as well as lowering poverty rates. The comparison between the new and old clients of MFIs is suggestive of the fact that: the older the MFIs is, the more the opportunity to escape poverty is at reach. It is noted that an ambiguity submerges in the short-term micro-credit. The impacts of microfinance are timely joined. Time as a variable is marked importantly in appreciating microfinance in the long term.