PurposeThe purpose of this paper is to address the problem of why the poorest, most disadvantaged groups such as rural African women, benefit less from microfinance. The authors focus on the perception and experiences of ordinary rural entrepreneurial women on microfinance in a context of extreme poverty and where family responsibility and economic activities are closely intertwined.Design/methodology/approachThe authors purposefully sampled 15 poor females with small businesses in two Nigerian villages. The key characteristic guiding the sampling was that the respondents had to be poor. The authors held two focus groups and ten interviews to capture their experience and understanding of microfinance. The authors used thematic analysis to establish patterns in the data.FindingsFor poor entrepreneurial women, a livelihood for survival, putting food on the table and paying school fees are priorities, not business growth. They see microcredit as debt and a great risk that could lead to irreversible losses. Family responsibilities for basic consumption needs of the household can affect their ability to repay loans; perceived dangers of microcredit may outweigh potential benefits.Research limitations/implicationsThe theories, especially functionalist economic theory, do not take account of microfinance users’ experiences.Practical implicationsMicrofinance should be aware that the poorest perceive microcredit differently and should eliminate the intimidating barriers raised to them. Instead of providing a means for the poor to alleviate poverty or coping strategies for them to manage cash flows and risks, microfinance causes fear and anxiety by demanding high rate of return in a very short period of time.Social implicationsThe very poorest, who should be the beneficiaries of microfinance, are less likely to be able to benefit. The condition of poverty creates different realities for those at the base of the pyramid.Originality/valueThis research questions the neoliberal rationality assumptions that microfinance rest on; the paper fills a gap in the literature, i.e. how the potential borrowers themselves living in deep-rooted poverty perceive and experience microfinance.
Journal of Small Business and Enterprise Development – Emerald Publishing
Published: Jun 18, 2018
It’s your single place to instantly
discover and read the research
that matters to you.
Enjoy affordable access to
over 18 million articles from more than
15,000 peer-reviewed journals.
All for just $49/month
Query the DeepDyve database, plus search all of PubMed and Google Scholar seamlessly
Save any article or search result from DeepDyve, PubMed, and Google Scholar... all in one place.
Get unlimited, online access to over 18 million full-text articles from more than 15,000 scientific journals.
Read from thousands of the leading scholarly journals from SpringerNature, Elsevier, Wiley-Blackwell, Oxford University Press and more.
All the latest content is available, no embargo periods.
“Hi guys, I cannot tell you how much I love this resource. Incredible. I really believe you've hit the nail on the head with this site in regards to solving the research-purchase issue.”Daniel C.
“Whoa! It’s like Spotify but for academic articles.”@Phil_Robichaud
“I must say, @deepdyve is a fabulous solution to the independent researcher's problem of #access to #information.”@deepthiw
“My last article couldn't be possible without the platform @deepdyve that makes journal papers cheaper.”@JoseServera