5th Annual Conference Nice - European-microfinance.org

Abstract
Microcredit in France: does Gender matter?
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5 th Annual Conference Nice
S. Brana, Senior Lecturer, University Montesquieu-Bordeaux IV
LARE-EFI, Avenue Léon Duguit
33608 Pessac
00(33) 5 56 84 29 75 brana@u-bordeaux4.fr
The question of the link between microcredit and gender has given rise to an
abundant literature in developing countries but not in industrialised economies, where
studies have focused more on women and entrepreneurship or self-employment. In both
cases, however, observations are similar: women are limited to so-called feminine activities
that are not very capitalistic and generate little profit. A possible explanation is that women,
unlike men, do not have enough of their own funds. This leads them to opt for businesses
that require little investment in terms of capital, but that will not enable them to generate a
reasonable income.
Microfinance institutions’ (MFIs) target poor people, excluded from the banking
system. By giving them starting capital, they should thus enable a greater number of women
to create their own business, but also in sectors traditionally reserved for men. Our study
covers a portfolio of 3,640 microcredits in France over the 2000-2006 period. It identifies
microfinance institutions’ client profiles, brings to light the men/women differences and
compares them to a wider sample of entrepreneurs. We show that the men/women gap found
amongst company creators is maintained amongst clients of MFIs. We also demonstrate that
the gender criterion is a decisive factor of the amount of the microcredit when compared to
the borrower and firm profile. To a certain extent, MFI thus reproduce gender inequalities.
Key words: Microcredit, Gender, Entrepreneurship.
JEL codes: G21, J16.
I. Introduction
Although women represent 47 % of the French working population, in 2006 they
accounted for only 30% of nascent entrepreneurs. Women entrepreneurs, on average, study
longer than men but have less work experience and start their business with less capital
(Insee, Sine survey 2006). These reasons may explain why they face greater difficulties
obtaining bank loans and funding their projects.
Moreover, women are more likely to be affected by unemployment and poverty. The
employment rate for women in 2005 was 57.6%, as opposed to 68.8% for men, that is a
difference of 11.2%. The part-time employment rate is of 30.7%, as opposed to 5.8% for men.
Women represent the majority of non-working people, of long-term unemployed, of
beneficiaries of the minimum social income, or of single parent families. They are therefore
particularly vulnerable to the risk of poverty.
For all these reasons, women should be particularly concerned by microcredit.
Microcredits are very small loans (less than 40% of the income per capita) granted to people
totally or partially excluded from the banking system. In developing countries the aim of
microcredit is to reduce poverty, promote self-employment and improve the empowerment of
socially excluded persons, women in particular. In industrialised countries, the goal is first of
all to reduce poverty by encouraging self-employment. Microcredit thus answers two types of
needs (Brana, Jegourel, 2007). On the one hand, it enables people excluded from the banking