The effects of microcredit on women’s control over household spending: a systematic review

Publication Details

Vaessen, J, Rivas, A, Duvendack, M, Jones, RP, Leeuw, F, van Gils, G, Lukach, R, Holvoet, N, Bastiaensen, J, Hombrados, JG and Waddington, H, 2013. The effects of microcredit on women’s control over household spending: a systematic review, 3ie Systematic Review 4. London: International Initiative for Impact Evaluation (3ie).

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Jos Vaessen, Ana Rivas, Maren Duvendack, Richard Palmer Jones, Frans Leeuw, Ger van Gils, Ruslan Lukach, Nathalie Holvoet, Johan Bastiaensen, Jorge Garcia Hombrados, Hugh Waddington
South Asia, Europe and CIS, Middle East and North Africa, Sub-Saharan Africa
Equity Focus
Review Type
Effectiveness review

Main findings

Headline Findings: a summary statement

The authors conclude that there is no consistent evidence of a positive effect of microcredit on women’s control over household spending in low- and middle-income countries.

Evidence Base

The authors included 29 papers describing 25 unique studies in the review. Twenty-two of these studies took place in South Asia (13 of them in Bangladesh), five in sub-Saharan Africa, and one each in Morocco and Kyrgyzstan respectively.

Implications for policy and practice

Impact of microcredit on women’s control over household spending 

The findings of the meta-analyses of the included studies suggest that microcredit does not have an effect on women’s control over household spending. Four studies based on a randomised design find no statistically significant effect of microcredit on women’s control over household spending, individually or when pooled using meta-analysis (Standardised Mean Difference [SMD]: -0.007, 95% Confidence Interval [CI]: -0.04, 0.03). The meta-analysis of quasi-experimental and regression studies likewise finds that the overall effect is not statistically significantly different from zero (SMD: 0.07, CI: -0.01, 0.14). The review finds some studies with positive statistically significant effects, but these effects are generally small in size and mostly come from studies with a high risk of bias. 

Behavioural mechanisms underlying microfinance/empowerment relationship 

The authors identify important mechanisms which mediate the effect of microcredit on women’s control over household spending. They conclude that microfinance-delivery mechanisms and the relevant gender-relations context play an important role in determining whether or not microcredit can make a difference to women’s control over resources. The authors identify the following important ‘situational mechanisms’: that is, mechanisms that show how specific social situations or events shape the beliefs and opportunities of microfinance actors: 

  • availability and provision of money, such as the size of the loan given; 
  •  the existing financial situation of the household;  
  • the (demographic) composition of the (larger) household (for example, number of children) and the position of women in the household;
  • the division of labour, the existing balance of decision-making power in households, and compliance with (traditional) norms; 
  • the opportunity structure related to other activities. 

The authors also identified the following ‘action-formation mechanisms’ that can positively affect women’s control over household spending: that is, mechanisms that demonstrate how individual choices and actions are influenced by specific combinations of (individual) desires, beliefs, and opportunities: 

  • awareness-raising among women (through media exposure); 
  • education of husbands to encourage women’s empowerment; 
  • entrepreneurial drive (‘spirit’); 
  • rituals practised within the credit/lending group; 
  • women’s pride, self-esteem, and ‘self-efficacy’;
  • encouragement to participate in external affairs and interact with others, with the aim of creating social capital, which in turn may lead to new ideas and insights and a change in power relations; 
  • skill-building and development of new competences as a result of outside employment and participation in (credit) groups and networks; 
  • peer pressure, knowledge of being monitored, and blaming, naming, and shaming in group lending schemes. 

Finally, the authors identified several ‘transformational mechanisms’: that is, mechanisms that can show how a number of individuals through their actions and interactions generate higher-level outcomes. However, the review was not set up to identify these comprehensively.

Implications for further research

The authors state that the next logical step would be to undertake a systematic review of qualitative studies of microcredit and women’s decision-making power in the household, in order to uncover credible theories of microcredit and the circumstances in which it may change women’s decision-making power.


Over the past three decades, microfinance activities have spread across the globe, reaching tens of millions of poor households with tailored financial services. Despite the diversity in microcredit schemes, many share two characteristics: they target poor women and often rely on some type of group-based lending. It has been argued that access to microcredit can foster changes in women’s empowerment, an important dimension of which is women’s control over household spending. The main assumption is that by providing credit to poor women, their direct control over expenditures within the household is increased, with subsequent implications for the status of women and the well-being of both women and other household members. Despite the central and recurrent importance of this aspect of women’s empowerment in relation to microcredit activities, there has been no previous systematic review on the topic.

Research objectives

The objective of this study was to provide a systematic review of the evidence on the effects of microcredit on women’s control over household spending in developing countries, and the mechanisms through which effects are mediated.


The authors included studies using randomised designs, quasi-experimental designs, and regression analysis, provided that the studies used a comparison group. They included studies that assessed the effects of microcredit schemes which targeted poor women in low- and middle-income countries and which evaluated women’s control over household spending. This included outcomes such as women’s decision-making power, women’s bargaining power, or women’s control over expenditures. The authors included both published and unpublished research covering the period between 1980 and December 2011. The authors conducted a search of relevant academic databases, internet search engines, and organisational websites, including Econlit, Web of Knowledge, JSTOR, BLDS, World Bank, Microfinance Gateway, and 3ie, and also conducted manual searches of books and additional journals. The authors undertook random-effects meta-analysis to synthesise the effects of included impact evaluations. In addition, they conducted a qualitative ‘realist synthesis’ of the included studies in order to identify the causal mechanisms linking microcredit to women’s control over household spending.

Quality assessment

This is a high-quality systematic review. Its value is somewhat reduced by the limited reporting about the methods of qualitative synthesis, and in particular the application of realist-synthesis approaches. However, the review does not draw conclusions relating to causal mechanisms which go beyond the evidence that it presented.

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