Aspiration Problems in Indian Microfinance

This article examines the problems that arise from borrowers’ growing aspirations for credit in rural South India. Two core problems arise, conditioned by the class origin of each family: first, a tendency to borrow beyond the capacity to repay, and second, the creation of new gender tensions in which female individualism clashes with traditional male dominance of household decision making. The problem of excess aspirations was first described by Veblen and has been fleshed out in the credit context by Bourdieu. Thus, in the theory of consumer culture, there are strands which may be of use in planning and managing microfinance and rural banking. We place this sociological issue in the context of the political economy of class and class praxis. The research is based on field visits in southern Andhra Pradesh. Our fieldwork suggests that one example of excess borrowing is women’s use of microfinance to purchase a cow. Both individual level and social aspects of the situation are considered carefully. The aspiration problem could lead to default and suffering.