Microfinance North and South: Contrasting Current Debates

This paper sets out to examine the apparent consensus around microfinance as a tool to address poverty and social exclusion in North and South. The current emphasis on scale and sustainability in Southern microfinance practice fits the counter revolution in development thought but contrasts with the origins of community banking in the North. The roots of the latter lie in a critique of mainstream economic and financial systems and seeks to re-invent them in ways that bring social, economic and environmental costs and benefits into focus. The role of microfinance in building sustainable livelihoods, both economic and social, is then examined. Finally, it is suggested that, as with any intervention, microfinance has no inherent capability to address gender inequities but must be deliberately made to do so. © 1998 John Wiley & Sons, Ltd.