Microcredit, Essay Example

Throughout the world, single mothers are faced with the unfortunate tasks of providing care for their children while also attempting to make a life for themselves.  Needless to say, this is not a simple task and often results in women and their children entering into a status of poverty due to their situation.  Furthermore, there has been a common injustice and discrimination towards lower-income females when attempting to receive credit and use this credit towards receiving funds from investors that could be used positively to change their lives and work towards leaving behind the life of poverty once and for all.  This discrimination by banking institutions has led to the global feminization of poverty as rich men who own the banks seldom wish to lend financial resources to anyone who is considered a risk – especially a single mother who is struggling to fight for a way out of poverty.

This struggle has been noticed by few bank owners and a concept called microcredit has been established to help reduce the total discrimination of lending practices and provide women in poverty the opportunity to receive credit.  It is believed that women in poverty are actually more intelligent with their finances and would utilize loaned funds more efficiently to invest in ways that will improve their overall quality of life.  Furthermore, few banking institutions believe that women in poverty are actually more likely to make good on their loan payments after such changes in their lives have been made.  In other words, the microcredit program has begun a feminist movement to give strength to impoverished women throughout developing countries across the globe.  This has changed the way that lenders commonly look at this segment of the population and the microcredit program has so far been found to be successful.  While it is still a monumental risk to offer credit to anyone who may not remit a return on the bank’s investment, microcredit has shown that impoverished women as a collective group can be trusted and should be trusted.