A Critical History of Poverty Finance

Digital financialization and surveillance capitalism in the Global South: The new technologies of empire

“…Digital finance quickly became incorporated in these grand plans, as an The Economist (2020) article enthused, "For those seeking to help the worst-off in poor countries, the mobile phone has been a magic wand" (as quoted in Bernards, 2022a). Here I situate digital finance within the broader context of "poverty finance" which Rankin (2013) defines as a global development strategy that coopts the Global South as an important site of financialization.…”

“…This in turn left a significant majority of the colonized population impoverished and in debt. Peasants and workers were indebted not to formal financial institutions but to the capitalist farms, mines and merchants that employed debt as a mechanism to discipline and commodify labor (Bernards, 2022a).…”

“…Colonial banks were clustered in urban centers to serve the extraction activities of merchant capital and lending was restricted to large scale public works and larger colonial enterprises. Credit was not meant for the wider colonial economy nor were these banks interested in long-term investments as most of their assets were held in metropolitan centers (Bernards, 2022a).…”

The Underside of Microfinance: Performance Indicators and Informal Debt in Cambodia

“…Over the past few decades, microfinance has become a dominant development strategy around the world. While the microfinance industry provides a range of services, its main business is lending credit, purportedly to reduce poverty, empower women, improve well‐being, or a combination of these goals (Bateman and Maclean, 2017; Bernards, 2022; Kar, 2018; Mader, 2015). However, in practice, the global microfinance industry no longer lends credit based on measuring these social impacts.…”

“…Yet, by building a global industry based on financial performance indicators, microfinance is managed and regulated in ways that do not account for these informal practices. As a result, this industry claims that it successfully helps to alleviate poverty, even as it accumulates profits by appropriating wealth from poor and low‐income households across the global South (Bateman, 2010; Bernards, 2022; Green, 2022a; Schuster and Kar, 2021).…”