Micro-credit/Micro-finance as a tool to eradicate poverty and empower women in underdeveloped
countries has been a darling of developed countries, especially DAC donors. It has been
argued that small amount of credit given as a group loan brings opportunities for women otherwise
denied through institutions asking for loan guarantees. The success stories from micro-credit
borrowers from Bangladesh, India and Africa and global endorsement of micro-credit programs
have largely ignored various local initiative managed by groups of women in rural as well as urban
areas, these indigenous solutions. Although systematically recorded history of such indigenous
initiatives is lacking, women in these settings would attest that there exists generational
knowledge about such small-scale group based micro lending. Interestingly, women only groups
have largely managed these group initiatives, at times even as a secret savings plan for a festival or
wedding; investment for home buying or a small business venture. These group loans have their
own operational mechanism, interest rates as well as repayments systems. These loans are either
short term or long term and function on rotational basis. This paper explores two such local
initiatives managed by groups of women in Malawi and Pakistan, based on the fieldwork
conducted through informal conversations as well as field data collected over two years. It would
then compare and appraise the variance (if any) with micro-credit programs run by micro-finance
institutions. It would be valuable to explore the notion of women’s empowerment as understood
by women involved in indigenous lending programs as opposed to institutional micro-credit
borrowers.