Group lending microenterprise development programs: An anthropological perspective

Abstract

With the backing of major donor agencies and non-governmental organizations, microenterprise development programs (MDPs) continue to proliferate throughout the world. These have the intention of harnessing the entrepreneurial skills which have been identified in the informal sector in order to improve standards of living. Making financial credit accessible is the primary method used by MDPs in order to reach their goals. From an anthropological perspective, this bid for social change raises issues concerning the suitability of a credit-centered mechanism that neglects the implications of social innovations which have endemically addressed the same issue of inaccessibility to capital resources. Most importantly, associational relationships which go beyond credit will determine the viability and appropriateness of such a program--especially when a group lending approach is used. Anthropologists can greatly enhance the effectiveness of MDPs by identifying the group dynamics of prospective program participants and by emphasizing a "people-centered" approach in general.