Gender and the Impact of Credit and Transfers

Ignoring gender in the planning and
evaluation of credit and transfer programs can lead to
erroneous conclusions about who benefits from them. Access
to institutional credit and targeted transfers can be an
important mechanism in poverty reduction, social protection,
and income redistribution programs. These formal sources of
financing, however, may undermine traditional sources of
support, such as inter-household transfers and informal
credit from neighbors. The likelihood and the consequences
of this happening depend in part on whether institutional
transfers and credit target men or women, whether men and
women have access to the same sources of financial support,
and whether using institutional credit or transfers
challenges conformance to traditional gender roles. The
gender dimensions of public transfers and credit discussed
in this note have the following policy implications: 1)
Placing resources in the hands of women may benefit
households more than targeting men. 2) Institutional credit
and public transfers may have to compensate them differently
for the potential loss of informal financial support. 3)
Evaluation of public transfer and credit programs should
assess the differential impact that credit and public
transfers have on men and women via any substitution effects
on informal sources of financing; the impact on household
welfare via changes in the intra-household distribution of
resources; and the impact on those who send informal
transfers and credit to the household.