Living within the Narrative of Microfinance: Vulnerability, Well-intentioned Debt, and the Individualization of Social Problems in Quito, Ecuador

Uncertainty and unpredictability in the lives and livelihoods of informal microentrepreneurs in Quito, Ecuador, increase their vulnerability and make the challenges of life at the social and economic margins of society more difficult to overcome. Through their small informal microenterprises, they work to maintain their everyday survival and sustain their hopes for a better future. Some turn to microfinance to support their microenterprises. Worldwide, microfinance is promoted as a powerful instrument for social and cultural change, creating a narrative of microfinance that contains promises of transformative effects. Over 16 months of research, interviews with 120 informal sector microentrepreneurs revealed these promises and the limitations of microfinance in their lives and the individualization of social problems present within the narrative of microfinance. The strength and flexibility of this narrative of microfinance has been built, interpreted, and reinterpreted in ways that allows it to be applied, and accepted, in various global social and political contexts. Informal microenterprises and microfinance are ways that people cope with economic uncertainty and social instability in Quito. Although people turn to microfinance in an effort to cope with their vulnerability, microfinance can increase their everyday vulnerabilities and place the responsibility for overcoming social problems upon the individuals who suffer them the most. Microfinance, therefore, becomes well-intentioned debt, creating new subjects and selfhoods that shift the social problems of poverty and inequality to individual problems that should be overcome by self-reliance.