School of Social and Political Sciences - Theses
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ItemThe politics of microfinance: is there any hidden agenda? A case study of BMT Kube Sejahtera, Indonesia( 2009)There has been a significant shift in development practice from state-led to market-led approaches. This phenomenon brings neo-liberalism onto centre stage in many development and poverty alleviation strategies. This thesis examines the adoption and implementation of neo-liberal thinking in microfinance programs as a poverty alleviation strategy through partnership between the state and NGOs. The purpose of the study is to describe and demonstrate the influence of neo-liberalism on a microfinance program/institution (MFI) and its clients. This research is not an economic study of microfinance but an inquiry into the 'relationship' between microfinance and neo-liberalism. The study provides a qualitative understanding of how neo-liberal thought penetrates and operates on the microfinance program. I utilize a qualitative case study to examine the microfinance program. The case study research is a hybrid between an intrinsic and an instrumental approach. The intrinsic case study research focuses on the context, issues, and process of the microfinance program; while the instrumental case study research explores issues related to neo-liberalism and microfinance. The analysis relies on coding. Themes that are abstracted from coded text segments are then analyzed using the theoretical frameworks and literature review. There were four major findings from this study. First, spirituality can assist in the transformation process from poor individuals into micro-entrepreneurs. Furthermore, spirituality can develop a positive mentality and protect the poor (in this case, the kube or group members) from the unwanted side of the market economy. Secondly, microfinance provides a field for the state to implement its disciplinary power. By reformulating the disciplinary power into a microfinance program, the state through MFI does constant surveillance and shapes the conduct of the poor. In practice, microfinance as a panoptic organization 'measures', 'corrects' and 'scrutinizes' the poor through its services. Thirdly, the unfavourable milieu of the bureaucracy provided an excellent setting to show that market-based poverty alleviation or neo-liberalism can only work in a favourable milieu that is free from unscrupulous and inefficient influences. Lastly, neo-liberalism is not a 'retreat of the state' but in fact a continuation of government and a transformation of politics that restructures the power relations in society. State intervention and planning is visible in the microfinance program.