Impact of microcredit on women empowerment indicators: An empirical reserach in the state of Uttarakhand

Abstract

Women Empowerment has been on national agenda of every government. In developing nation women comprises fifty percent of the population so empowering them is crucial for development and nation building. Various Microfinance Institutions (MFIs) extends microcredit/loan via group model (Self Help Groups and Joint Liability Groups) to the marginalised segment particularly women groups and minorities primarily residing in rural areas with an aim to empower them and foster their socio-economic development. Previous studies have shown that microcredit has positive impact, but providing credit alone does not guarantee empowerment of the member beneficiaries. From past studies it can be concluded that empowerment demand an integrated approach from all the participating bodies/institutions involved, only then can be the objective of socio-economic development be accomplished. Since today very limited literature is available on microcredit and its impact. The current research examines the impact of microcredit on women empowerment indicators (decision making, awareness and psychological factors) of member beneficiaries in Haridwar district of Uttarakand. Women are organized into groups (Joint Liability Groups) and provided microcredit /loan. Non Probability sampling (Convenience Sampling) technique is adopted in sample selection where access to microcredit serves as independent variable and women empowerment indicators serves as dependent variables. The study consists of sample size of 362 member beneficiaries. Hypothesis testing is applied to find the significant association between the dependent and independent variables. Inferential statistics i.e Chi sq test is used to find the association/relationship between access to microcredit and empowerment indicators. Results indicate that there is no association between access to microcredit and women empowerment indicators. The results indicate that microcredit vial JLGs makes no impact on the empowerment indicators, making no improvement in the lives of its beneficiaries. There is need of regular and continuous impact assessment by credit institutions, participation from states and local bodies, must be analysis of socio-cultural factors and formation of women self administered system are some of the recommendations of the study. The results can be used by various stakeholders in designing better approach and as it provides them information on the areas which needs improvement so that microcredit can bring positive difference in the lives of beneficiaries. Also, it opens doors for further research in order to explore the socio-cultural factors which influence women empowerment.