The Financialization of Micro-Credit


  • Rob Aitken

  • Research for this paper was supported by a Standard Research Grant from the Social Sciences and Humanities Research Council of Canada. I would like to thank two anonymous reviewers for Development and Change for constructive feedback. I would also like to recognize the generous advice and ongoing support of Jacquie Best, Randall Germain, Michael Chu and Dwight Hesse. Invaluable research assistance was provided by Monty Bal. As usual, any errors or omissions are solely my responsibility.


The financial crisis which crested in 2008/2009 sparked much debate regarding the future of global financial governance. Echoing the ways in which that crisis entailed a particular intrusion of ‘high finance’ into everyday lives, the main contention of this article is that critical analyses of finance would benefit from training attention onto the intersections between global finance and the level of the everyday and the mundane. To explore this intersection, this article reviews the increasing ways in which micro-credit has been financialized. This process of micro/financialization, I argue, has been accomplished in very particular ways which have brought micro-credit networks and their borrowers more fully into the spaces of global capital markets. This development, however, confronts vulnerable populations of micro-borrowers with serious risks of various sorts. Most importantly, micro/financialization risks exporting — and globalizing — some of the riskiest parts of financial practices to the ‘poorest of the poor’. I conclude the article by noting the ways in which this involves a particularly dangerous extension of what some commentators have referred to as the ‘democratization of finance’.