WOMEN BORROWERS OF MICROFINANCE: AN URBAN LAHORE STUDY

Abstract

Microfinance was initiated in the 1970's by Dr Muhammad Yunus, through provision of small business loans to impoverished rural villagers in Banglade. 1 The objective of microfinance over the last three decades remains to target'the poorest of the poor', enable them to mobilize small business ideas and to invest in non-financial social development of the borrower. 2 The achievement of the millennium development goals has been recognized to have links with microfinance expansion, as a tool for social development and elimination of poverty. 3 In 2005, 1.4 billion people in the developing world (25% of total population), lived below poverty lines of USD 1.25 per day. 4 It is estimated that 70% of people living below poverty lines are women5 and fears concerning the'feminization of poverty'have encouraged policy research toward possible solutions through microfinance services. It has been discussed that women have characteristics which trap them in poverty including lack of education, limited employment opportunities, low income, lack of labor laws and unpredictable labor supply due to domestic responsibilities and child-care. 6 Additionally, microfinance and women have become viable partners because women are known to be more credit-worthy in terms of loan repayment and to use their enhanced income for household welfare.