On Monday at the Chase Auditorium in Chicago, Grameen Foundation hosted a lunchtime discussion called, “Does microfinance reduce poverty? A dialogue on the social impact of microfinance as a development tool.”
This event aimed to answer this challenge: microcredit has been successful in increasing access to capital by the poor but does it actually reduce poverty for the people it intends to help?
Leading experts discussed the value of microcredit as a tool for poverty eradication and Grameen presented Measuring the Impact of Microfinance: Taking Another Look, a literature review of the most recent research examining the effect of microfinance on the lives of people living in poverty.
Kathleen Odell, Asst. Professor of Economics, Brennan School of Business, Dominican University, and author of Measuring the Impact of Microfinance
- Discussion Participants:
Beth Houle, Chief of Staff at Opportunity International
Alex Counts, President, CEO & Founder of Grameen Foundation
Attendee Ruth-Anne Renaud, Opportunity’s VP of women’s philanthropy, reflects on the conclusions and takeaways from the session. “What we found was that it’s important to avoid over-simplification when it comes to eradication of poverty,” she says, “because the question, ‘Does microfinance reduce poverty?’ is a very complex issue.” There are very positive effects of business investment and savings programs, and with studies that encompass longer-term perspectives, we are likely to see even more positive effects, she concludes.
As Alex Counts explains, “It’s not satisfactory simply to have loans repaid, we need accountability measures beyond that.”
Counts succinctly sums up the issues surrounding microfinance as a tool to alleviate poverty: “We need to not only do banking well,” he says, “we need to be deliverers of significant social change.”