In order to assess the effectiveness of microcredit on socioeconomic development, one must evaluate current microcredit loans and practices. The question that must be asked is to what extent are socioeconomic opportunities expanded through supplemental income from microcredit loans? To answer this question, measurable indicators that display characteristics of socioeconomic development need to be utilized. The following indicators are often used in impact assessments as representative of such development: investment in higher education, socioeconomic empowerment of women, access and utilization of health services, and prioritization of savings and investment. This paper will identify the observed deficiencies of the aforementioned indicators through a case study of a premier microfinance institution, the Grameen Bank of Bangladesh, and conclude with a reemphasis on the absolute need for gathering extensive empirical data and adequately utilizing it to provide a quantifiable impact of microcredit on sustained socioeconomic development. It is necessary to note that valuable progress has been made in the application and assessment of microcredit. However, limitations on funding, research, appropriate data collection and various other complexities (which need to be discussed further in separate research) have restricted the pace of progress.
"Does Microcredit Facilitate Socioeconomic Development?,"
Pepperdine Policy Review: Vol. 2
, Article 5.
Available at: https://digitalcommons.pepperdine.edu/ppr/vol2/iss1/5