Entrepreneurial activities and women empowerment in rural India between microfinance and social capital

Human development cannot occur without women's empowerment. Particularly in marginalized contexts lacking equal treatment between women and men, women's empowerment is conditioned upon their control of financial resources and activities outside their households' tasks, such as entrepreneurial activities. Such contexts have been experiencing the escalation of microfinance schemes of which women have been the main target group. While scholars generally agree on the opportunities that microcredit represents for microentrepreneurial activities, its effective impact on women entrepreneurship, and hence their empowerment, show contrasting results. We aim to contribute to this debate by conducting in-depth semi-structured interviews with female members of the group lending model of the microfinance institutions in Uttar Pradesh, northern India. The thematic questions of the interviews address, particularly, the social resources (social capital) and economic conditions underpinning the process of empowerment among women's members of peer-group lending schemes. We find that social capital plays a crucial role for peer-group lending to be successful in accessing financial resources and loan repayment. However, we detect the presence of empowerment only where a woman uses the outcome of these social capital resources to pursue her entrepreneurial activities and self-determined goals.