The dark side of micro-credit

Saturday, December 15, 2007
Santi Rozario

The writer teaches at the School of Religious & Theological Studies at Cardiff University, Wales.

Over the last two to three decades rural Bangladeshi society has experienced a complex range of developments. Among these, NGOs, micro-finance institutions and garment industries have become the major agents of change in the lives of rural Bangladeshi women. Women’s increased access to independent sources of finance, through participation in outside paid employment or through micro-credit, is usually taken as one of the main indicators of the improvement of women’s status and of women’s empowerment.

However, a puzzle remains: if these positive changes have resulted in women’s “empowerment”, why has there not been the kind of improvements in women’s position that might be expected, such as the reduction or abolition of dowry payments, or a reduction in domestic violence? Indeed, if anything these tend to be going in the opposite direction. Dowry amounts continue to rise, as does the associated violence against women.

It is true that individual women, women’s organisations and other NGOs continue to struggle against these problems. Yet, despite all this effort, women continue to be subject to demands for large amounts of dowry as a condition for acceptance by their groom’s family. Married women are also frequently subjected to physical and psychological violence by their husbands and in-laws if they cannot keep bringing in more and more dowry, especially within the first few years of their marriage.

To understand the seemingly intractable problem of dowry, we need to understand the rationale behind the practice. Dowry practices in Bangladesh (the demand or dabi from grooms’ families) are a relatively new phenomenon. Their rise is linked to the capitalist transformation of the Bangladeshi economy since the late 1960s and the resultant disjunction between the demands of the economy and the system of values in Bangladeshi society.

This has led to a valorisation of men and devalorization of women, legitimated both by a socially created surplus of marriageable women compared to men, and also by the threat posed to ideas of women’s purity and honour by women’s increasing physical mobility. All this in turn has made it possible for dowry to become a critical source of capital for families with sons, who are an increasingly prized commodity.

These new negative developments in relation to women and dowry can be understood better by appreciating that in Bangladeshi culture marriage and dependence upon your husband is thought essential for women. By ‘dependence’ I mean both perceived and real economic dependency as well as the moral or cultural dependency of all women on one or another adult man of their family. The necessity for all women to be married, along with the perceived ‘risks’ posed by an unmarried woman to her family’s honour, means that families feel pressured to marry off their daughters as soon as possible after puberty. This lowers the marriage age for women, so creating a perceived surplus of women in relation to men, who are not under the same pressure to marry and so generally marry later in life. This again leads to further inflation of dowries and to the further devaluing of women – economically, culturally and morally – in relation to men.

Dowry was declared illegal in Bangladesh in 1980. However, like many other laws in Bangladesh this has had little or no impact. When faced with demands for large dowries, families are reluctant to take legal action for fear of losing suitable grooms. Thus villagers will say that if one family takes legal action, no other potential grooms will come forward to ask to marry a girl from that village in future. While there are paralegal staff in some rural villages, poor people only seek their assistance when a woman has been divorced after repeated demands for more and more dowry, combined with extensive violence. Families never report cases when dowry is demanded during marital negotiations.

When I asked several groups of poor women what was their biggest problem during some recent research for CARE Bangladesh, their almost unanimous answer was “dowry”. When I asked about violence, I heard numerous stories about how most of the violence against women was related to their parents’ inability to meet the demands of husbands and their families for more and more money or other goods.

Dowry has come to be one of the most critical sources of capital for all families. It is not only practiced as a one-off payment during marriage, but many families continue to use their newly-married incoming wives as an ongoing source of capital, by sending them back to their natal home again and again to bring back more capital. If the wives’ families cannot oblige, the wives are subjected to violence, or even divorce.

One such woman I spoke to, Ruksana, is the second of four sisters from a poor family. She was married to her cousin Ataul, and her parents paid 80,000 Bangladeshi Taka as dowry. After the marriage her mother-in-law mistreated her and demanded a bicycle, some jewellery and additional Tk30,000. Ruksana’s mother took a Tk7,000 loan from Grameen Bank, bought a cycle and made some ear-rings in the hope that the mother-in-law (her own brother’s wife) would treat her daughter better, but Ruksana was pressured for more money. Ruksana did not want to tell her parents since they were already struggling to keep up payments on the first loan and could not afford enough food. Her mother-in-law then tricked her into signing divorce papers (she was told the papers were to obtain another loan), forced her to return to her parents’ house, and arranged a new marriage for Ataul.

This is where micro-credit has contributed to the escalation of dowry. While micro-credit has benefited large sections of the rural population in many ways, it has also worked against women’s solidarity and contributed heavily to the inflation of dowry. Grooms’ families are aware that money is available to brides’ families more easily now through Grameen Bank, the Bangladesh Rural Advancement Committee (BRAC) or other NGOs. I have often heard of women being sent home to persuade their parents to borrow money from an NGO for their husbands to invest in business, including buying items such as rickshaws, vans, grocery shops or irrigation pumps.

Although in theory micro-finance institutions do not lend money for the purposes of dowry payment, in practice it is common knowledge among the barefoot bankers (micro-finance institution employees distributing and collecting loans among village people) that most village families depend on micro-credit to meet dowry demands.

It is because of such near universal dependence of men on their wives’ families for capital that dowry has come to be perceived by women’s organisations as intractable and as ‘too political’ a problem to tackle directly.

Notwithstanding certain structural constraints, I still believe there are ways to arrest the problem of dowry and in this regard one can make a number of recommendations. They include: collaboration between institutions working for women’s rights to campaign on dowry, inheritance rights and domestic violence; development of a large-scale rural legal aid service; working with religious authorities; use of media, education and role models to contest village stereotypes of women.

Another key point to consider is that the perpetuation of dowry and violence against women cannot only be blamed on men, particularly poor men. It is actually the middle-class families, who keep their women relatively sheltered in order to protect their purity and honour, and compete most heavily for status hierarchy through dowry displays, who are most responsible for perpetuating both dowry practices and gender domination.

Middle-class women too gain from this status hierarchy. They demand dowry for their sons, are relatively able to pay large dowry for their daughters, and play active roles in maintaining their superior status in relation to less well-off women. As a result, they are often the people least willing to reject the dowry system. It is hard to see how things will change for poor village families when they are taken for granted by the rural and urban middle classes, who act as moral arbiters for the society as a whole.

In tackling the problem of middle class attitudes, a piecemeal approach may work. In the shorter term, the younger middle class generation, who might have studied abroad and returned to Bangladesh, and do not necessarily share the same values to their parents, could be targeted. They are more often prepared to challenge familial values, for instance by marrying someone of their own choice without involvement of dowries.

Finally, education is frequently recommended as a solution to all sorts of problems in Bangladeshi society. I would recommend the same, but with less emphasis on rote learning and more on educating the young so they begin to question gender and other structural hierarchies very early in life.

This article first appeared on


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