Contribution of Rural Women to Family Income Through Participation in Microcredit: An Empirical Analysis

Problem statement: Rural women in Bangladesh have a lower socio-economic status and very limited access to income generating activities due to a number of social, cultural and religious barriers. Consequently, they have less opportunity to contribute to their family income. Rural women are economically dependent and vulnerable and socially discriminated. Microcredit programme provides loans to the rural poor women in order to undertake small financial and business activities that allow them to generate income. This income earning opportunity helps the rural women to contribute to their family income and achieve a level of independence. Approach: In the present study, an attempt has been made to assess the impact of microcredit programme on rural women’s contribution in improving the household income. The study is based on empirical data collected through interview from the two groups of rural women e.g. ‘with credit’ and ‘without credit’ rural women. The ‘with credit’ respondents represent the rural women who have taken loan from the Grammeen Bank’s microcredit programme. The results show that the proportion of the ‘with credit’ rural women who contributed to family income is much higher (19%) than that of ‘without credit’ rural women (10%). A multiple regression analysis was conducted to identify the factors influencing the respondent’s contribution to the total monthly family income. Results: The multiple regression analysis shows that there were strong positive effects of age of respondent, level of education, family size, earning member, occupation of respondent’s and also monthly income of respondent’s while status of marriage has a strong negative effect. It was found that majority of the ‘with credit’ respondents contribute much higher to the family incomes than the ‘without credit’ respondents. It was also found that with ‘credit rural’ women have improved their socio-economic status and income generating activities by participating microcredit programmes of Grameen Bank. Conclusion: It is concluded that women can contribute to increase in family income which is essential for survival of the rural poor families. Therefore, the MFIs should create provision of credit for women to get them involved in income generation activities.