Revisiting Socio-economic Effects of Microcredit: A Case of Mymensingh District in Bangladesh

This paper explores the socio-economic impacts of microcredit in Mymensingh district of Bangladesh. Using a household survey in four sub-districts of Mymensingh, the paper finds that microcredit programs contribute to poverty reduction in this particular area by augmenting income and expenditure on consumption. The borrowers improve their dietary intakes, educational attainments, and health as well as housing conditions. Women can take part in family decision making and their authority in family increases. Borrowers’ assets and net worth increase after participating microcredit program as well. There are some problems identified such as insufficient credit amount and lax monitoring by program officials. Small micro lenders are also mushrooming in Bangladesh and they charge usurious rates of interest on credit. Strong government monitoring is required to control malpractices in the micro finance market.