ABSTRACT
This chapter reviews critiques of microcredit from various perspectives. The key themes are the appropriation of microcredit by neo-liberalism in the 1980s as a mechanism to push back on the state centric basic human needs approach that had gained popularity as a heterodox development alternative in the 1970s. Neo-liberalism appropriated the theme of female empowerment by asserting that it was intrinsically facilitated by microcredit. The initial practitioners of microcredit found women were much better clients in terms of repayments and hence in reducing organizational transactions cost. Yunus and the microcredit movement were logical partners of neo-liberalism. A review of the vast literature on microcredit suggests that Islamic instruments are being considered as an alternative in general terms and also in specific country contexts. Several econometric studies concluded that micro-credit had a positive impact on women in general or on female empowerment in particular.
