Women empowerment is one of the central issues in the developing countries. This study
investigated the empowerment and successful stories of poor women who participated in
two microfinance programs in Pakistan; namely National Rural Support Program and
Khushali Bank. Previous studies have shown how women’s participation in microfinance
institutions can improve individual and household income. However, limited evidence
exists on whether involvement in microfinance can improve the women’s economic
decision making empowerment, freedom of movement empowerment and life
satisfaction. This study is based on household level data collected from 744 poor women
of Bahawalpur division in Pakistan. The results from the Multinomial Logit Model
(MLM) estimation show that the women borrowers are more empowered and satisfied
than the non-borrowers. The probability of involvement in economic decision, having
more freedom and happiness increases with the increase in loan size. However, marital
status is found to be statistically insignificance to economic decision, while it has a
positive influence on freedom of movement empowerment. Furthermore, the results also
show that the probability of being happy decreases with age and marital status, but it
increases with family size and empowerment. Based on the analysis, the study concludes
that the level of women empowerment and satisfaction of poor women in Pakistan can be
significantly improved with the involvement of Microfinance Institutions. The results
suggest that higher income increases the women's ability to contribute more to the
household expenditure, eventually improving their empowerment and life satisfaction.
This study recommends that while making policies and allocating the budget on
education, policymakers and other non-governmental organizations should focus on how
these expenditures are distributed and who will be benefited from these. In addition,
government and development organizations should work with greater cooperation in
order to increase the women’s empowerment and happiness by implementing strategies
to increase the availability of more educational programs and better guidance schemes for
the borrowers.