Studying group dynamics: an alternative analytical framework for the study of microfinance impacts on poverty reduction

Group dynamics have been largely neglected when the impacts of microfinance on poverty reduction are assessed. This paper presents an analytical framework in which the study of group dynamics is central, and new channels of impact effects on the individuals participating in microfinance schemes, their households, enterprises and communities are assessed. Four potential outcomes of this fresh approach to the analysis of poverty impacts are argued; they may have dramatic implications for the way we look at the effectiveness of microfinance today.