Microfinance: Champion in Poverty Alleviation and Failure in Female Empowerment ALEXANDRA DOBRA »Gender equality is more than a goal in itself. It is a precondition for meeting the challenge of reducing poverty, promoting sustainable development and building good governance.« kofi annan I n 2005, according to the World Bank, 16.1 percent of the world’s population lived on less than 1 us dollar a day(which corresponds to absolute or monetary poverty) and 57.6 percent lived on less than 2.5 us dollar a day. Moreover, according to the Microcredit Summit 2005, women represent 70 percent of individuals living on less than 1 us dollar a day. Not only do women represent the major part of the poorest in­dividuals, but in addition they are also the most vulnerable. On the basis of these reports on female poverty and vulnerability, it seems imperative to help them, among other things through microfinance programs. Poverty reduction strategies are strongly related to the promotion of development. Thus, while in the developmental process, humans are vital actors, speaking about development without seeking to reduce in­equalities between men and women leads to both curtailed development and curtailed poverty reduction. Furthermore, the World Bank(2001) has stressed that the chronic gender inequalities characteristic of many developing countries are also restraints on economic growth and devel­opment. Therefore, the amelioration of gender equality appears to be a crucial component of effective durable development strategies, as echoed by the un ’s Millennium Development Goals. Using microfinance programs to give women access to financial services is a means of mobilizing their productive capacities for the bene­fit of economic development. In addition, the fact that women’s public status – which tends to be precarious – is contradicted by their private status(within the family they have multiple responsibilities) implies that 134 Dobra, Microfinance ipg 3/2011