Loan Take-Up: Around 1.5 years after Spandana extended credit offers, 27 percent of eligible households in treatment areas had taken up loans from Spandana or another MFI, compared to 18.3 percent in comparison areas.
Business Activity: Generally, there is little evidence that microcredit offers impacted business activities. Treatment households were no more likely to own a business or start new businesses. After 1.5 years, households in treatment areas reported investing around twice as much in their businesses as households in comparison areas. However, a second endline survey conducted 3.5 years after the initial microcredit offer shows no difference in investments between the two household types. After 3.5 years, business investment levels were around 25 percent higher for treatment households.
Spending: There were no significant differences in total household expenditures between treatment and comparison groups. However, expenditure patterns were different for different groups. Treatment households bought more durable goods for their homes and businesses (i.e. they invested) and cut back sharply on temptation goods (tobacco, eating out, etc.)and festivals. A switch from temptation goods to investment may lead to higher consumption in the future.
Education, Health and Female Empowerment: No evidence was found to suggest that microcredit empowers women or improves health or educational outcomes. Women in treatment areas were no more likely to be make decisions about household spending, investment, savings, or education. Households in treatment areas spent no more on medical care and sanitation than do comparison households, and were no less likely to report a child being sick. There was no change in the probability that children or teenagers were enrolled in school or in the number of hours worked by girls or boys aged 5 to 15, although teenage girls' labor supply decreased.
1 CGAP. “Financial Inclusion” http://www.cgap.org/topics/financial-inclusion. Accessed: 2015. 01.20
2 Greater Hyderabad Municipal Corporation, “Chapter V: Basic Services to the Urban Poor,” Hyderabad - City Development Plan, http://www.ghmc.gov.in/cdp/chapter%205.pdf. (Accessed September 8, 2009)