Loan Repayment Pressure in the Practice of Microfinance in Bangladesh: An Empirical Study on Grameen Bank, BRAC and ASA
Keywords:Microfinance, Repayment Pressure, Loan Default, Loan Trap, Poverty
AbstractThis paper shades light on the â€˜loan repayment pressureâ€™, which is allegedly exerted by the Micro-Finance Institutions (MFIs) on their borrowers in Bangladesh. A qualitative study was carried out to assess the experiences of the borrowers, who are engaged with Building Resources Across Communities (BRAC), Grameen Bank (GB) and Association for Social Advancement (ASA). The observations and findings from the in-depth interviews highlight the effects of repayment pressure imposed on the borrowers. This pressure pushes the borrowers into a vulnerable economic condition, while disharmonising their social and family lives.Thus, this study provides a deeper understanding of the repayment issues. So far, very few studies have been carried out in Bangladesh on this particular topic. Findings of this study can add value to the current literature by providing insights on the forced loan recovery technique and its negative effects.
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