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Microlending and the Financialization of Poverty with Sohini Kar

Sep 12, 2023
01:02:54
Snipd AI
A discussion on microfinance and its impact on poverty in the Global South, with a focus on India. Dr. Sohini Kar explores the empowerment and exploitation aspects of microfinance, highlighting concerns about the financialization of poverty. The conversation also delves into the story of Muhammad Yunus and the Grameen Bank, and practical ways to support women in India and the global south through microfinance institutions. The podcast concludes with a call to question investment financing and leverage financialization for social change.
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Podcast summary created with Snipd AI

Quick takeaways

  • Microfinance often fails to deliver on its promises, burdening the poor with high interest rates and creating a financialization of poverty.
  • The recognition of microfinance through Nobel Peace Prize winners like Muhammad Yunus and Grameen Bank provides credibility but limited impact in addressing poverty and inequality.

Deep dives

The problematic nature of microfinance

Microfinance, touted as a solution to poverty and a means of empowering women, often fails to deliver on its promises. Many microcredit loans are used for basic consumption needs rather than entrepreneurship, and the high interest rates imposed on the poor create a burden rather than an opportunity. There is a growing financialization of poverty, where the poor are seen as a source of profit for financial institutions. The success of microfinance is often measured by high repayment rates, but the pressure to repay can have detrimental effects on the well-being of borrowers, including cases of suicide. The focus on profit and the lack of flexibility in repayment terms make it clear that microfinance is not a silver bullet for poverty alleviation.

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