Gendered Impact of Microcredit in Mali: An Evaluation by Propensity Score Matching

The objective of the paper is to rigorously test whether the potential effects of microcredit on poverty reduction are more significant for female beneficiaries than for male in Mali. The dataset we use comes from surveys conducted in 2007–2008 in Mali. It covers a large sample that compares 2400 microfinance client households, of which around 70% are microcredit beneficiaries. To do this, we perform the propensity score matching (PSM) method. Statistically, the study shows that older women have more chance of getting loans than younger women. In terms of amounts (borrowed and saved), men outweigh women. However, regarding loan amounts, women seem to use greater proportions of the loan and are more committed to using the money for income-generating purposes. At the same time, the level of savings relative to the loan amount is the same for the two genders. From an econometric perspective, this research confirms that microfinance in Mali has a positive impact on poverty alleviation in total, and higher for female than for male beneficiaries. The findings, therefore, present the importance of the length of the membership with the MFI for women. Based on these results, we can interpret this as meaning that women show efficiency in using loans for economic activity but rather in the longer term than in the short term compared to men. In light of these results, microcredit in the case of Mali seems to be effective in alleviating poverty for both men and women. In term of policy recommendations, MFIs should target men in rural areas, although this may lead to higher distribution costs in the short term, in the long term it may reduce risk and lead to higher profits. The government in partnership with donors should provide support to women entrepreneurs so that their initial learning curve is enhanced and enable them to benefit from microfinance loans, even in the short term.