Good debts, bad debts: microcredit and managing debt in rural south India

Carswell, Grace, De Neve, Geert and Ponnarasu, Subramanian (2020) Good debts, bad debts: microcredit and managing debt in rural south India. Journal of Agrarian Change, 21 (1). pp. 122-142. ISSN 1471-0358

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This paper engages with debates around microcredit, once a development success story, but now much critiqued. Arguing that microcredit can only be understood within the wider context of debt, we draw on ethnographic material from two villages in Tamil Nadu, to examine how microcredit through self‐help groups sits within a broader context of indebtedness among the rural labouring classes. We describe patterns and sources of borrowing among the poor, the ways in which debts are managed, negotiated and settled within households and the ways in which the management of debt is mediated by gender, caste, class and aspiration. The paper calls for a more nuanced understanding of debt: some debts are seen as ‘good’ and others as ‘bad’. We explore the ways in which microcredit, channelled through self‐help groups, is—against much contemporary criticism—perceived by women borrowers in our study villages as a source of ‘good debt’ and praised as an enabling factor in their everyday household management as well as in aspirations for mobility and development. We also argue that microcredit can have positive impacts by enabling social investments that enhance status and reduce dependency.

Item Type: Article
Additional Information: This is the peer reviewed version of the following article: Carswell, G, De Neve, G, Ponnarasu, S. Good debts, bad debts: Microcredit and managing debt in rural south India. J Agrar Change. 2021; 21: 122– 142., which has been published in final form at This article may be used for non-commercial purposes in accordance with Wiley Terms and Conditions for Use of Self-Archived Versions.
Schools and Departments: School of Global Studies > Anthropology
School of Global Studies > Geography
SWORD Depositor: Mx Elements Account
Depositing User: Mx Elements Account
Date Deposited: 02 Apr 2020 06:59
Last Modified: 28 Apr 2022 01:00

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