Banking is for Others: Contradictions of Microfinance in the Ghanaian Market
Recent literature on microfinance has observed that commercial microfinance programs that achieve financial sustainability largely fail to reach the poor (Hulme 2000; Mayoux 2000; Cull, Demirgüç-Kunt, and Morduch 2007). Most studies rely on institutional explanations for this failure (Battilana and Dorado 2010; Pache and Santos 2010; Canales 2011). Using a Braudelian conceptualization of a fragmented, three-tiered capitalist world-economy, this study examines how Ghanaian market women finance their businesses within the bottom layer of the capitalist world-economy, and why, despite the availability of commercial microfinance, they continue to rely on informal finance. I argue that commercial microfinance is structurally constrained by contradictions between the profit-driven logic of the upper layers of the capitalist world-economy and the socially-embedded and subsistence-driven logic that organizes the market in which market women operate. I also show that, to the extent that commercial microfinance partially penetrates the market, it disrupts the circulation of financial resources and weakens existing social and economic networks within the community.
Copyright (c) 2016 Irene Pang
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