Micro-Borrowing: Navigating the Responsibilities of an Indebted Life

Drawing on a larger ongoing investigation in the outskirts of Lima and in the Amazonian plain, informed by interviews with micro-borrowers and employees from microfinance institutions, this manuscript illustrates how micro-borrowers handle the multiple sources of credit at their disposition (such as commercial banks, NGOs, microfinance institutions, private lenders, communitarian lenders, etc.). In most cases, these credit alternatives come with minimum requirements, guidance, or institutional support. Facing a growing number of credit offers, consumers at the bottom of the pyramid are particularly vulnerable. Conflicting desires, unchecked consumption, and the need for financial resources to combat tragic events or chronic illnesses can negatively transform micro-borrowers’ financial well-being overnight, putting them at risk of over-indebtedness.

Citation:

Pilar Rojas Gaviria and Domen Bajde (2017) ,"Micro-Borrowing: Navigating the Responsibilities of an Indebted Life", in LA - Latin American Advances in Consumer Research Volume 4, eds. Enrique P. Becerra, Ravindra Chitturi, and Maria Cecilia Henriquez Daza and Juan Carlos Londoño Roldan, Duluth, MN : Association for Consumer Research, Pages: 5-10.