Cover of Financializing Poverty by Sohini Kar
Financializing Poverty
Labor and Risk in Indian Microfinance
Sohini Kar

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July 2018
256 pages.
from $27.95

Cloth ISBN: 9781503604841
Paper ISBN: 9781503605886

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Microfinance is the business of giving small, collateral-free loans to poor borrowers that are paid back in frequent intervals with interest. While these for-profit microfinance institutions (MFIs) promise social and economic empowerment, they have mainly succeeded at enfolding the poor—especially women—into the vast circuits of global finance. Financializing Poverty ethnographically examines how the emergence of MFIs has allowed financial institutions in the city of Kolkata, India, to capitalize on the poverty of its residents.

This book reveals how MFIs have restructured debt relationships in new ways. On the one hand, they have opened access to new streams of credit. However, as the network of finance increasingly incorporates the poor, the "inclusive" dimensions of microfinance are continuously met with rigid forms of credit risk management that reproduce the very inequality the loans are meant to alleviate. Moreover, despite being collateral-free loans, the use of life insurance to manage the high mortality rates of poor borrowers has led to the collateralization of life itself. Thus the newfound ability of the poor to use MFI loans has entrapped them in a system dependent not only on their circulation of capital, but on the poverty that threatens their lives.

About the author

Sohini Kar is Assistant Professor of International Development at the London School of Economics.

"Among the many critics of the World Bank's mantra that financial inclusion will solve the problems of the poor, few voices are as impactful as Sohini Kar's. With gripping stories, ethnographically-informed nuance, and a theoretically sophisticated way in which it 'joins the dots,' her book doesn't typify microfinance as simply good or bad. Rather, it shows how debt enfolds people into globalized financial networks, transforming them into little more than balance sheet figures to be reckoned by calculators of financial risk."

—Deborah James, The London School of Economics and Political Science