Received wisdom about Bangladesh's forays into microfinance—the extending of small-scale credit for poor rural women to establish small businesses—has, for much too long now, been an uncritical celebration of neoliberalism. According to this hagiography, microfinance's appeal to European and American investors is that well-meaning financiers can serve the global poor while at the same time making a profit. When reducing the role of government regulation in the orchestration of such transnational projects, microfinance has the potential of cutting through bureaucratic red tape, enabling the easy extension of capital to the rural poor through the auspices of NGOs. By targeting rural women as the recipients of such small-scale business loans, microfinance capitalizes on the purported fiscal responsibility of women to promptly pay back their loans: the micro-lending repayment rate in Bangladesh is at an impressive 98 percent, surely one of the most solid investments available. Wishing to recognize the ingenuity of microfinance in the global arena, the Nobel Prize Committee awarded microfinance pioneer Muhammad Yunus and the Grameen Bank itself the coveted Nobel Peace Prize in 2006, proof positive of the goodness of microfinance. Because of these factors, and with influential political leaders on the bandwagon, microfinance has been heralded as a potential remedy for poverty worldwide.

Lamia Karim's book is a most welcome intervention in the literature of microfinance, offering bold and critical perspectives into the unintended consequences and reverberating effects of microlending in Bangladesh's post-independence economy. Karim's historically inclined methodology sets the stage for the introduction of microfinance in the context of Bangladesh's split from East Pakistan in 1971. The welcome end to a hard-fought war of independence nonetheless ushered in instability and rapid downturn in the already fragile economy. An influx of foreign capital through the auspices of local NGOs to rural areas held the promise of attacking some of the world's most dire poverty. Within the structure of microlending, women would work as their own bosses, raising chickens or conducting other agricultural ventures, or in more recent years, “phone ladies” would use a microloan to purchase a cell phone and run a home-based business where customers would come to place occasional calls to far-flung relatives living in other villages, towns, or cities, or abroad.

As a cultural anthropologist of South Asia and development, Karim brings to light a number of voices not normally considered in the evaluation of microfinance—the women themselves who seek and receive microloans, middle-class representatives and managers of the NGOs, village imams, and the husbands and families of the women. By employing the ethnographic method to her study of microfinance, Karim is able to explore how microfinance works in individual cases, and her results are startling. Instead of being empowered to lift themselves out of poverty through individual entrepreneurship, Karim finds that rural women too often become mired in debt to multiple predatory lenders. With 23,000 NGOs and twenty million women clients of microfinance, microlending practices are deeply embedded in the Bangladesh economy, and often exacerbate social problems. It is common for a woman to take out a loan for a particular venture, only to have her husband or other senior male family members access the money to cover dowry expenses or other family needs. Precisely because Bangladeshi women are not autonomous subjects and live within patriarchal structures, women often do not exercise total control over microloans. Microlending adds to existing social and economic pressures, Karim argues, by expanding and hardening networks of money-lending practices. Women take out additional loans to pay off existing ones, becoming further mired in debt, and are subject to shaming and social ostracism when their financial obligations are not repaid. Particularly sobering are accounts that Karim provides where women's houses and property are seized or demolished when relatively small amounts of debt are left unpaid. Though local clergy criticize high interest rates and unscrupulous collection practices as being anti-Islamic in character, local mosques too are embroiled in NGO webs as recipients of benefits offered by microlending groups, such as paved roads leading to local mosques.

This book works extremely well in a variety of classroom settings. I have successfully taught Karim's book in history courses on Muslims in Asia, as well as in women's studies courses. Karim's crisp writing is accessible. The subject matter of this book is presented clearly and speaks to readers interested in anthropology, history, business, feminism, transnationalism, and South Asia.