Performance of microcredit towards empowerment of women – a case study of saving and credit cooperatives in bardiya district of Nepal

Abstract

Microcredit has often been seen as an important means of empowering women. A study was conducted in the Mid-Western Development Region of Nepal to explore impact of microcredits in women’s empowerment. A total of 32 women borrowers of micro-credit was randomly selected from eight cooperatives. A pre-tested questionnaire was administered to collect the data. Qualitative information was collected through case studies. Most of the survey respondents (94%) are over the age of 25. Nearly three-quarter of the respondents did not have formal education. About 44% of respondents have an average monthly income of NRs. 11000-20000 (94-170 US$). Only 3% have average monthly income below NRs 10,000 (85 US$) and 6% have income above NRs 50,000 (427 US$). All respondents maintain a savings account – 88.5% with cooperatives and 12.5% with the bank. Most of them (90%) have a regular savings pattern. All respondents received cooperative loans with 41% borrowed loan for more than three times and 19% borrowed loan only once. Approximately 31% of respondents also borrowed loan from the micro finance institutions. Nearly 94% of respondents repaid their instalments on time. The study shows different levels of impact on the role of micro-credits in women’s empowerment. In the case of women’s decision-making power and change in the attitude of men towards domestic violence, there was no change in the status of women, even after joining cooperatives and borrowing micro-credits. However, more than two-third of respondents indicated that their respect had improved significantly in the family. With respect to participation in community activities, 60% of respondents felt that it had improved after borrowing micro-credits. Almost 53% also indicated that their communication skills had improved than before. About 94% of respondents reported having improved confidence in their work or business. The data are collected by perception survey that only provides information about what people feel or think. A longitudinal study involving a control group and more respondents in the treatment group is recommended to validate the findings of this study.