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Our View from the Ground: Microcredit—The Financial Revolution

Photo of Bethany Cole

Bethany Cole is Senior Program Associate for EngenderHealth.

Reading Chapter 11 in Half the Sky about microfinance brings me back to Batouri, the small town in Cameroon where I was a small-business volunteer 10 years ago with the Peace Corps. Recently out of college, I was ready to work hard and eager to make a difference. My earnestness and naiveté were matched only by my inability to conjugate verbs in the future perfect tense in French. There, I soon realized both the potential and the challenges of microcredit.

Batouri is a small town in the Eastern Province—the largest and least developed of Cameroon’s 10 provinces. At the end of a dirt road and not far from the border with the Central African Republic, I thought I was at the end of the earth. Placed in a start-up microcredit lending institution and bank, my role involved marketing the bank to members of the community and generating new membership and support. From this funding and with additional resources from the parent bank in the capital city of Yaoundé, members of the bank could take out loans.

I partnered with the water, sanitation, and health volunteers in the region and had discussions with local village groups far from the main road. I encouraged them to join the bank so they could expand their work and improve living conditions in the area. But it was challenging; many in my community were justifiably suspicious of banks. Because of past experience, they believed that money sent to the bank was money thrown away. The colonial legacy in the country and centuries of being stripped of natural resources without proper compensation created an environment where corruption within government, civil society, and private enterprise was the norm. As a result, most people preferred to save money through a tontine—a tradition of microfinance that has existed there for centuries—where a group of friends meet regularly and give loans to members when needed. With this close network, social pressure ensures that loans are paid back.

Kristof and WuDunn endorse microcredit programs that lend to women, citing examples of programs and people who were able to turn despair into success. One of the organizations highlighted, Kashf, has nearly daily check-ins with people who have taken out loans. To be sure, successful microcredit programs require intense programming support, follow-up, and money to start and keep them going. Microfinance can be impactful and successful, but it is labor-intensive and there are limits.

I found this out soon in Cameroon. A year after I arrived in Batouri, the office manager helped himself to the bulk of the members’ savings to build a latrine that never materialized and the money was squandered. There was outrage, but little was done to reclaim the money. I cringed to think about all of the people whom I had urged to open accounts and whom I assured that their money would be safe. The other lending institution in town went bankrupt the next year. It was supported by the World Bank and lent primarily to women.

Ultimately, empowering women and tackling gender norms that result in women’s disenfranchisement is a goal we can all support. Indeed, creating sustainable economic opportunities for both women and men has larger political implications.

I am now based in the United States but travel to Africa regularly. I am less naive but still hopeful, and I find the stories told in Half the Sky inspirational. I continue to learn more from my African colleagues and friends than I offer—and I still can’t conjugate French verbs in the future perfect.