AN EXERCISE IN WORLDMAKING 2009 - ISS

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One Size Doesn’t Fit All:
Tailoring Credit Programs
along the Logic of the Poor
BERNICE CAMPOS ROLDAN
INTRODUCTION: MINIMALIST OR COMPREHENSIVE?
Microfinance has proved to be a potent concept in development. The
1990s saw the upsurge of slogans such as ‘helping the poor help themselves’
and ‘giving a hand up, not a handout’. The concept continues to
benefit from immense support ‘across the political spectrum, in an era of
domestic welfare reform and cutbacks on foreign aid budgets’ (Woolcock,
1999: 17-18). Rogaly (1996, in Mosley and Hulme, 1998: 783) observes
how the concept of providing loans to microenterprises for poverty
alleviation has in recent years ‘generated enthusiasm bordering on
hysteria’. It is a political concept that has captured the imagination of the
left ‘by being redistributive and a direct approach to alleviating poverty,
and to the right as facilitating the emergence of an independent, selfsustaining
“penny capitalism”’.
Discourse used to underscore the need for education and training to
help the poor make the most out of credit. Development practitioners
and credit providers thought along similar lines in that providing training
in livelihood and financial literacy would unleash the poor’s entrepreneurial
spirit, which would then enable the poor to work towards a better
quality of life. Hickson (2001: 55) explains the logic behind this approach:
‘[Some microfinance institutions] include technical training in
their programs with the rationale that extremely poor people do not have
the entrepreneurial skills or assets to use business loans productively’.
Parallel to this approach, Hickson adds that other MFIs ‘take the view
that minimalist programs are more likely to become sustainable and can
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