research articles about microfinance

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Published: 08 December 2022

Exploring the role of microfinance in women’s empowerment and entrepreneurial development: a qualitative study

Ambreen Khursheed ORCID: orcid.org/0000-0003-1497-5848 1

Future Business Journal volume 8 , Article number: 57 ( 2022 ) Cite this article

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In developing countries, women’s empowerment is a major concern. Several efforts were made to tackle this issue as the aims of poverty reduction and development cannot be achieved without giving attention to women’s empowerment. Over the past decades, microfinance institutions (MFIs) have appeared as crucial tools not only to address the issue of poverty but also particularly to empower women. Resultantly, a huge number of studies focus on the relationships between MFI and women empowerment. However, in the context of rural areas of Pakistan, the research is limited. Therefore, the objective of this study is to investigate the role of MFI in women’s empowerment in Pakistan so that the research will facilitate MFIs and policymakers in strengthening the link between MFIs and women entrepreneurship. We have used a qualitative methodology, using primary data collected through in-depth interviews and a focus group discussion with six female borrowers of Rural Community Development Programs (RCDP). The empirical results provide valuable insights into the efforts made by RCDP to empower women and combat poverty by encouraging women’s entrepreneurship. Hence, this paper not only examines empowerment, which women are attaining from microfinance but also assists MFIs to know about their significance in developing the economy. The paper is significant for MFI practitioners to develop policies for boosting women’s entrepreneurship and to help their existing women clients with efficient training and supervision.

Introduction

Microfinance has a unique ideological demand as compared to charity. It is particularly designed to support poor people. However, it is a long-term process that enables the poor to improve their living standards in an effective manner [ 39 , 41 , 74 ]. In particular, when we talk about microfinance from the perspective of women, the role of benefactors of microfinance seems important in making it a relatively effective resource for poverty alleviation, the stability of economic growth, and women empowerment [ 25 , 39 , 41 ].

The difference between male and female ratios is not considered significant, but in several areas, women are provided less importance and power in comparison with men [ 29 , 37 ]. Women around the world have little control over their assets and have less political power. Further, they do not have a lot of properties to their name [ 58 , 68 , 87 ]. Due to a lack of security saved in the financial sector, women faced several difficulties during the financial crisis period which lasted from 2007 to 2008 [ 52 ]. Similarly, it is crucial to understand the impact of the recent crisis of COVID-19 which affected all businesses badly and also threatened world health security [ 81 ].

However, several researchers have questioned this statement. The classification of all expected benefits and disadvantages of MFIs is still in the initial phase. We are still discovering how to improve the living standards of poor women and their families. This study aims to broaden existing knowledge about the role of MFIs in empowering women in rural Pakistan.

In emerging economies, MFIs and women empowerment is considered to be one of the most effective tools for poverty alleviation by particularly focusing on women [ 62 , 87 ]. Certainly, women are one of the most important parts of society and without their presence, societies cannot improve [ 23 ]. Women empowerment leads to the increased participation of females in the workforce, the capability to decide, and poverty reduction. Thus, an increase in their income will not only prove beneficial for their family but will also have a very positive influence on the economy [ 58 ]. Another study investigated the nonlinear effect of the education level on the ecological footprint by incorporating the variation in the population and income structures and recommended crucial policies regarding education levels and environmental sustainability [ 82 ].

In developing countries, all businesses are male-dominated and females have to suffer from discrimination in most of the phases whether it is their personal life or professional life. However, financial segregation seems complicated for developed nations regardless of the gender factor. Financial stability is a key concern for developing as well as economically challenged countries as these economies do not have a stable financial environment and well-established institutions [ 42 , 43 ]. The presence of poor health facilities, underdeveloped financial industries, illiteracy, and weak infrastructure have raised serious problems for developing nations. To consider the requirements of financially excluded women, MFIs step forward to help those women in establishing new endeavors [ 55 ]. As a result, non-government organizations and government agencies decided to provide subsidized loans for a better lifestyle of people and poverty alleviation. Prior researchers appreciated the initiative of such investments (for example, [ 25 , 60 ]), but disproportion has been observed in these investments from the side of rich landlords or agencies. To tackle this issue, some highly effective alternative social networks, social collaterals, and credit scoring are needed here to approach the poorest women [ 57 ]. Moreover, women in more rigid cultural settings are likely to face a higher risk of domestic violence because economic empowerment intervenes with patriarchy and expedites change in rigidly defined gender roles [ 27 , 28 ]. Therefore, the need to address gender power imbalance and existing gender roles need to be taken into account before making interventions to empower women. It is found that the main body of the related existing literature primarily discussed only those factors that played a key role in the supply side of agriculture finance and microloans. A few past studies have also focused on the demand side of microfinance loans. However, the study of Guirkinger and Boucher [ 21 ] and the study of Ashraf and Ali [ 7 ] have highlighted the possible hurdles of the demand side of microfinance loans faced by smallholders. These obstacles include complex application procedures and complexity in providing loan securities. The seminal work of Garikipati et al. [ 18 ] reveals that the process of providing loans to the poor is uncertain, and is not easily generalized. So, people should be careful to utilize this development tool. However, it is clear that these loans provide financial benefits for poor women in developing new endeavors [ 71 ] and also act as a smart policy to help the poor [ 10 ]. Irrespective of the talk of “gender neutrality,” MFI clients that are women of immobile poor backgrounds have a lower default record as compared to men. MFI start-ups usually have significant and underreported economic effects because the poor women who work within households are not getting the standard pay and have limited start-up funds.

Brière and Szafarz [ 13 ] reported that MFIs have now become a risk-averse thing and it is “financialized,” i.e., MFIs now act as mainstream financial institutions. On the other hand, MFIs are considered a good source of financial support for women in starting new businesses and a tool to eliminate poverty in the country but this fact is not applicable universally because MFIs can also appear as an enigma in providing microfinance access to women. In various literature studies, researchers have focused on savings and credit products MFIs. It has been found that research studies are showing great interest in microfinance. Therefore, we aim to explore how MFI can lead to women’s empowerment and entrepreneurship. Furthermore, we also decided to investigate the possible benefits of microfinance for women from RCDP’s microcredit program.

Problem statement

One of the objectives of microfinance is to enhance women’s empowerment and to generate employment opportunities by promoting self-employment that consequently improves the social well-being of poor people. Most of the existing studies, mainly in economics, have only focused on how MFIs lending helps in poverty alleviation, rather than analyzing its impact on social and financial empowerment and new venture creation by women. The majority of the past studies were quantitative [ 9 , 15 , 17 ], while there were a few qualitative studies applied in various contexts that analyzed the impact of MFIs in enhancing women’s empowerment but still substantial studies are not available which explores specific lived experiences of women borrowers when they avail microloans and how they utilize that loan in starting their businesses. Therefore, this study aims to enhance the understanding of the role of microfinance from the viewpoint of beneficiaries in improving their empowerment and entrepreneurial development.

Significance of the study

Pakistan is a developing country and the majority of its population is living under the poverty line and are mostly unaware of different sources of financial facilities. MFIs particularly focus on such rural areas in which most of the people are un-bankable and marginalized. This study contributes to the extant literature, as it explores the lived experiences of women borrowers regarding empowerment and entrepreneurial development. To get deeper insights into the structural meaning of empowerment analyzed by considering participants’ histories, lived experiences, and social interactions, we used a qualitative approach that relies on in-depth interviews and a focus group under the case study research design. This study provides valuable insights into how MFIs are making women socially and financially empowered. Also, how microfinance helps in women-led ventures’ creation process. To investigate how microfinance is increasing women’s empowerment, we deduced the following sub-objectives.

To explore how women become socially empowered after getting micro-financed.

To figure out how women become financially empowered after getting micro-financed.

To determine how microfinance increases women’s entrepreneurship.

Literature review

Microfinance

Microfinance programs have been playing a dominant role in poverty alleviation since long ago [ 40 ]. The vision behind the growth of microfinance is to pull the poor toward the entrepreneur side by giving them enough credit to achieve this goal. However, microfinance usually considers one assumption, i.e., the beneficiaries have adequate social capital, human capital, and other required assets for expanding their small-scale businesses. This indicates that the lack of credit is the only prominent hurdle experienced by poor women [ 73 ]. This assumption seems quite complicated because the growth of even a small business requires a lot of competencies, knowledge, expertise, and abilities [ 2 ]. Another major issue is that microfinance faces difficulty to approach the right poor people [ 16 ]. In the light of practical aspects, microfinance refuses the poorest division of people from borrowing money. This violates its role in approaching very poor applicants [ 14 , 83 ]. Furthermore, the poorest household people who are availing the benefits of microfinance still lack the proper technical skills that are necessarily required for business. The background of microfinance shows it is an essential tool to alleviate poverty, it works by receiving donations and lending money to poor people. Microfinance programs disregard the non-income parameters of poverty such as health, security, and education [ 11 ]. The study of Shaw [ 64 ] explains how the poorest households possess limited formal education. Also, poor health and undernutrition play a vital role in limiting the overall productivity of such households. The lack of education results in severe illiteracy which can badly affect the poor and make them unable to properly understand the effective working procedure of loans. Famous examples include Akhuwat, AGAHE Pakistan, AMRDO Foundation, non-bank microfinance companies, and many more.

Measuring empowerment

The study of Malhotra et al. [ 47 ] reports that the identification of empowerment as a primary development tool has been done, but still, institutions such as the World Bank and development agencies haven’t introduced an authentic method for estimating and analyzing the tracking variations in various levels of empowerment. Researchers define empowerment as a dynamic procedure that is complex to measure. The reason behind this is that empowerment is related to social, economic, and political challenges as well [ 63 ]. The spiritual, social, political, and health factors make the complete empowerment measurement procedure and these all factors are interconnected with each other. The term empowerment can also be expressed as a way of independent decision making, identification, and utilization of resources [ 1 ]. The literature reveals that empowerment is a multidimensional concept and it can be assessed under multiple dimensions [ 31 ]. This study primarily focuses on the influential impact of microfinance on women’s empowerment in the context of the financial and social aspects. This is because the financial and social aspects of women’s empowerment help increase the development of both the quality and quantity of existing human resources. These two aspects are proven as critical factors in enhancing the development of a society.

Meaning of women’s empowerment

There is significant diversity in the agendas, emphases, and terminologies used for describing women’s empowerment. Many papers have defined empowerment and its measurement approaches. The most common terms used in the extant diverse approaches use power, choice, control, and the option to describe women’s empowerment [ 72 , 78 ]. However, it is still confusing to say whether the terms “empowerment”,” “gender equality,” “women’s autonomy,” and “women’s status in society” are similar or different concepts. The term women empowerment has been conceptualized mostly as an outcome or a capacity or some means to an end, and a process of achieving power [ 35 , 54 ].

Microfinance and women’s empowerment

Women are the main target audience of microfinance programs. This credit amount not only helps poor women to grow economically but also improves gender equality, the status of women within the family, their health, and their education level [ 35 ]. Moreover, women are examined as a good credit risk by microfinance programs due to their increased propensity to repay loans [ 24 ]. In contrast, men are more interested in moving their money toward risky business practices and are at high risk to consume this money on tobacco, gambling, or drinking [ 20 ]. However, Goetz and Gupta [ 20 ] also highlighted that a significant percentage of women’s loans are directly invested in business activities by their male relatives, but the liability of repayment goes to women borrowers. The recent literature primarily discusses the evaluation process of microfinance programs [ 3 , 38 , 65 ] in the context of the well-being of borrowers [ 14 , 50 ] and empowerment capabilities of women [ 61 ]. The reporting of these evaluations reveals some conflicting conclusions, and it still tells that borrowers have an absence of accounts for themselves and this impact of credit can affect their lives [ 35 ]. There is limited evidence in the literature on how the poor perceive the process of microfinance loans. In addition, the existing literature has limited scope regarding the “transformative process” of entrepreneurship which reveals the lives of those needy people who are living in extreme poverty [ 76 ]. In response, this study fills the gap in the literature by examining how most disadvantaged borrowers or potential borrowers themselves perceive and experience microfinance in a context characterized by extreme poverty, one where family responsibility and entrepreneurial activities are closely intertwined.

A study reported that 95% of Grameen’s borrowers were females and this percentage kept on raising till 2011. Similarly, Aghion and Morduch [ 6 ] highlighted that 71% of total borrowers of MFIs were women. Further, past researchers have also pointed out that MFIs target women because their default rates are very low as compared to men [ 5 , 36 ]. Because of this reason, MFIs have launched several innovative schemes to financially support their female clients. MFIs play a crucial role in enhancing the empowerment of women as it boosts their resources, increase return on human capital by improving their affordability, and consequently improve their living standards.

Social empowerment of women

Women’s social empowerment refers to having a supportive environment by using different affirmative programs and policies for the empowerment of women along with the provision of easy and equal access to necessities of life [ 48 ]. In the field of development, empowerment has become a catchword, with a specific focus on poverty alleviation and the political addition of marginalized groups of women [ 49 ]. Microfinance has proved socially beneficial for women [ 35 ]. In a pivotal study, Mahmud [ 46 ] described that microfinance institutions have a significant positive influence on women’s social empowerment as it substantially improves their control of income spending and intra-household decision-making power, which resultantly enhances their welfare. Sinha et al. [ 67 ] found that women’s participation in MFIs enhanced their capability to spend money, mobility, and dominance in household decision making. Further, Montgomery and Weiss [ 51 ] concluded women’s participation in MFIs leads to enhance family decision making and found that family landholdings, media exposure, and institutional access are key determinants of women empowerment [ 26 ]. Similarly, it was found that savings impact is more significant on women as compared to men as it enhances their decision-making power related to family planning, family expenses, recreation, and their lifestyle [ 8 ].

Therefore, there is a need for an integrated microfinance program comprising education with skill-building training for increasing the capacity building of women and fortifying the relationship between women’s social empowerment and microfinance [ 4 ].

Financial empowerment of women

Many past studies have analyzed women’s empowerment from different perspectives; however, financial empowerment is ignored to some extent. In this study, one of the main objectives is to examine the financial empowerment of women. Past studies have reported that financial empowerment can be understood through three factors; financial literacy, financial attitude, and financial well-being. Financial literacy is inherent in humans and is recognized as the primary privilege of humans. “Financial literacy is the capability of understanding finance” [ 75 ]. Lack of financial knowledge ultimately pulls poor people away from success in financial markets or businesses [ 79 , 86 ]. The importance of financial literacy is equal for men and women. However, it is reported that if women have stronger financial knowledge then they can do effective future planning [ 45 ]. Financial knowledge is related to financial attitude. The financial attitude refers to the capability to manage finances, interest in enhancing financial knowledge, and investment decisions. Past studies revealed that financial knowledge, financial attitude, and financial behavior affect financial empowerment or financial well-being [ 33 , 66 ]. The concept of financial well-being is related to personal traits, knowledge of finance, and attitude. Therefore, the subjective meaning of financial well-being varies from person to person [ 32 ]. Thus, the financial empowerment of women can be assessed by considering financial literacy, financial attitude, and financial well-being.

Research gap

The literature discussed following the structure from the history of microfinance to concepts of women empowerment leads to the discussion on the relationship between women empowerment and microfinance. The literature depicts that different indices were explained in prior research studies giving a quick overview of empowerment but they are limited as they used a few variables, ignored key ontological issues, details, and subjective experiences that deepen the understanding of empowerment [ 9 , 15 , 17 ]. Therefore, this study fills the existing gap as we interviewed women in their natural settings and in their contexts in which they interpreted empowerment from their viewpoints.

Further, there was a strong practical gap regarding the lack of research on how women experienced empowerment and entrepreneurship through microfinance. A majority of the past studies applied quantitative methodology with the top-down approach which focuses on the views of service providers instead of beneficiaries and thus the beneficiaries’ views were not considered. Therefore, it becomes evident that the quantitative approach is not suitable for understanding women’s empowerment because it is a process of realization and only participants can explain what empowerment means to them through their experiences and feelings of becoming empowered. Hence, it is significant to use a qualitative methodology to capture the real feelings and experiences of women. Therefore, we applied the bottom-to-top approach to analyzing the true essence of the lived experiences of women regarding empowerment and entrepreneurship. Thus, this study is based on a case study research design to explore the perspectives of women that how they interpret and understand the phenomenon of empowerment achieved through microfinance in their natural context. Overall, this study enriches the extant literature about women’s empowerment by explicating the complex phenomenon of empowerment through social, financial, and entrepreneurial contexts.

Research question

For exploring the effectiveness of MFIs in terms of women’s empowerment and entrepreneurial development, we propose the main research question of this study as follows;

What is the impact of microfinance on women’s empowerment?

Sub-questions

How does a woman become socially empowered after getting microfinance?

How does a woman become financially empowered after getting microfinance?

To what extent microfinance leads to women’s entrepreneurial development?

Theoretical framework

William’s theoretical model of women’s empowerment.

In this study, two theories as theoretical frameworks are used. The first theory is by Williams [ 84 ] who formed a theoretical model on women’s empowerment. In the development of this model, the innovative insights of Kabeer [ 34 ] were used. Given this theory, empowerment comprises three factors, resources, agency, and achievements. Here, the resources present the supporting factors which are utilized by women to achieve empowerment, the agency presents the ability of the women to achieve their goals, and achievement refers to the success of women in achieving their life goals. Resultantly, the results achieved represent achievements by combining resources with the agency. We have used this model for measuring women’s empowerment.

Status withdrawal theory

The second theory used in this study is the status withdrawal theory, this theory explains that when certain groups of people realize that they are not respected by society. They switch to entrepreneurship for getting respect from society [ 22 ]. Thus, entrepreneurship is a function of status withdrawal. We follow this theoretical framework for understanding the entrepreneurial development among women borrowers. As all women borrowers belong to a poor class so we will explore whether they have any status withdrawal intention behind starting their own business or not (Fig. 1 ).

Conceptual framework of the study

Methodology

This study adopts the case study design approach for the empirical investigation as it inspects a contemporary phenomenon within the real life of participants, particularly when the limits between the context and phenomenon are not visible [ 59 , 85 ]. The case study design is the most suitable design for this study to carefully understand the impact of MFIs on women’s empowerment as it provides more in-depth views about the phenomenon under study.

The variables and themes analyzed in the focus group discussions and in-depth interviews are presented in Table 1 .

Semi-structured interviews

A qualitative method, in particular, semi-structured interviews, and a focus group were employed in this study. We used an interview checklist for the collection of qualitative data as it helps to properly understand the psychology of the participants. Also, it helped us to identify missing information from the participants. All interviews were conducted by telephone. The participants were selected through purposive sampling, as it is widely used in information-rich case studies [ 56 ]. The MFI selected for this study is RCDP, this MFI has played a key role in developing economic activities in communities and it exclusively focuses on women. The sample size consisted of six participants, who are aged 35 or above. Semi-structured interviews were organized in two sections, the first section included background questions based on the loan history of participants at the RCDP, demographic details, and a description of current business progress. The s econd section comprised questions that were related to participants’ viewpoints about their experience of gaining empowerment. For example, respondents were asked to provide in-depth explanations regarding their daily tasks and how their tasks get influenced after getting microloans. We also used sample prompts such as, “What role has microfinance played in your life?” and “Have you experienced any change due to microfinance? How it supported you in establishing your business?” Grand tour questions were also used such as “How would you explain a usual work week?” The grand tour questions lead us to get in-depth information through mini-tour questions for determining the details about certain events and the experience of women borrowers [ 69 ], such as Could you describe to me what you do for the mid-day meal when you are at your business? This helped in inquiring about delicate features such as advantages and changes associated with the role of microfinance in enhancing women’s empowerment. After conducting the semi-structured interviews, a focus group discussion with borrowers was conducted. This discussion helped us to collect data about the socioeconomic factors of women’s empowerment. This method helped us to have firsthand information (Table 2 ).

Focus group

To analyze the experience and interactions among participants, a focus group plays an important role. Through focus groups, we probed answers to the best lending practice, saving plans, and effective interpersonal relationships between members. The group discussion helped us to make certain aspects clearer.

Data analysis, results, and discussion

Developing first-order codes and second-order themes.

For analyzing the data, thematic analysis is used. First, to form codes, the data analysis started with coding iteratively, recorded interviews were used in performing the analysis [ 19 ]. At the initial stage, the data is linked with first-order codes that focus on the main research topic, the impact of MFIs on women’s empowerment. After this, common themes were used to join data fragments together from different but interconnected categories developed in the open coding [ 70 ]. This helped in combining first-order with second-order codes in a more precise manner.

Incorporating first-order codes with second-order themes

In the second phase, the data was revisited to ensure precision in the second-order themes. The existing themes were refined or used to create new second-order themes. We analyzed the constructs for ensuring that the themes are reflecting first-order themes. For example, first-order coding statements related to respondents’ increased level of independence in decision making led us to form a second-order theme explaining “increase in independence in decision-making power.”

Later this statement was defined as “Social Empowerment” described by the first-order coding statements explaining independence to decide without asking anyone. This analysis adds precision in this phase, while simultaneously permitting us to better examine and improve other evolving concepts, such as “being independent.”

Accumulating the theoretical dimensions

After second-order themes, we determined the theoretical dimensions for understanding the interaction among themes. For instance, some themes represented real experiences of social empowerment (e.g., “autonomy in decision making”) while others related to their response to social empowerment (e.g., “confidence in expressing an opinion”). We examined multiple models to check how multiple conceptual models relate to each other, using existing empowerment theory whenever suitable. We evaluated potential models against the data to investigate how emergent theoretical understanding described our research model. Table 3 presents the methodology, presenting the first-order codes, the second-order codes, and the theoretical dimensions that effectively describe the lived experiences of participants and the impact of microfinance in gaining empowerment.

Table 4 reveals the data supporting each second-order theme by presenting that microfinance has proved very beneficial for all six participants. Our main research question was to determine how microfinance increases women’s empowerment. Thus, our results presented that microfinance drastically changed the perception of women borrowers about living an independent life and societal dynamics. Fulfilling the necessities is one of the primary issues of poor people and due to this, they have to earn for each day’s expenses. Further, because of having no savings to rely upon, the lines between households and businesses are often not so clear. All our respondents reveal that now they feel more confident and empowered as compared to their earlier condition. All participants shared that they spend their income on fulfilling their household expenses such as children’s schooling and utility bills. The findings of this study were obtained through thematic analysis which is useful in conducting identification analysis and pattern reporting within data [ 12 ]. This study aimed to determine how microfinance is an effective tool for women’s empowerment, and how microfinance leads to develop entrepreneurial characteristics among women, and how it is useful for women. The conclusions achieved from this study may not become generalizable for the whole population but it is generalizable at a conceptual level [ 30 ].

The study determines the role of RCDP in women’s social and financial empowerment with the help of a case study methodology. We have used focus group discussions with in-depth interviews. We explored the lived experiences of women before and after taking a loan from RCDP and its impact on their social and financial empowerment with a view of William’s theory. In the focus group discussion, all participants shared their lived experiences and in the in-depth interviews, each case was analyzed for understanding the actual circumstances through which each participant has gone through. In this analysis, open-ended questions helped in understanding the real scenarios. The main research objective was to utilize open-ended questions for developing a comfortable association with the participants so that they can share all their lived experiences conveniently. We have selected in-depth interviews and focus groups because these methods were found more suitable for analyzing each case.

Case 1 Participant (1) described when her husband died in a road accident. She became helpless. Her in-laws abandoned her with six children. Then, she applied for the microfinance program of RCDP and was provided with an initial loan worth Rs.75,000/- for establishing a small retail store of food items. In her village, no women were running their retail store. But she took this step to support her children and now she is running a successful business. The credit for her success goes to her decision of taking a loan and starting a new journey in her life. She expressed;

Life became miserable without my husband. It was difficult to feed six children. Without having a source of income and no place to stay. I felt that my life has come to an end. But microfinance helped me to get out of the crisis. Now I am living a peaceful life with my children.

Case 2 Participant (2) shared that she remained in an abusive relationship with her husband for 11 years. Her husband was addicted to drugs. He divorced her after the birth of their seventh daughter. Then, he got married to some other woman. She expressed that she has gone through severe depression during that time when was alone with her daughters. Her mother and sister supported her but financially they were not capable to feed her children.

I was extremely depressed due to my divorce. I had no source of income other than him. I was worried about my daughters. I have four brothers and they also refused to support me at that time. Then, I started weaving and also started a dressmaking business on a small scale after taking a loan from RCDP. Particularly, I was good at making girls’ dresses. Now my mother and sister are living with me and I am supporting my family with my business.

Case 3 Participant (3) expressed that microfinance helped her a lot in supporting her family. Initially, she took a loan of Rs 80,000 to start her business. She shared;

My husband was a plumber but his income was not enough to support the household expenses. Then a time came when my husband couldn’t find any job for three months. We were deprived of all necessities. And we also have three children who were not going to school due to our crisis. Then I asked my husband to start his own business of baking food items. Because I was good at baking. We both decided to take a loan and started our own business. My husband was narrow-minded, initially, he refused to accept me as a partner in his business. But when he realized that only after one week our business showed visible growth. Then he allowed me to help him and we also hired two more workers. Now our children are going to school and we are managing all our household expenses.

Case 4 Participant (4) expressed that her husband was an employee in a garment factory. One day the owner of the factory decided to wind up his business because of a lack of profits. My husband lost his job, he searched a lot for other jobs but he failed to find any suitable job. Then, he died due to a heart attack. She took a loan of Rs 60,000 for purchasing a sewing machine and some clothes. She shared

I was living a happy life with my husband and children but life changed when my husband lost his job. Further his death made the situation even worse. One of my neighbors told me about RCDP. Just because of my children I took a loan and started my own stitching business and now I am in a position to manage my all household expenses.

Case 5 Participant (5) shared that her husband was employed in a workshop. But he lost his job due to the closure of that workshop. They had no other source of money. For four months, her husband searched for another job but he couldn’t find any opportunity. Their children left school because they were not able to pay their fees. Then, she convinced her husband to take a loan and start their own business. Her husband was afraid that we will not be able to repay the loan. Then, they will lose their respect in the family. But she told him that they have no other option and they have to take this risk.

My husband knew how to manage a car workshop so we decided to use the loan amount for starting a business. Gradually our business flourished, and we also managed to repay our monthly loan installments.

Case 6 Participant (6) shared her life experiences by stating that her husband was an electrician and his income was not enough to support the family. They have six children and their school fees were not payable with that income. Thus, she asked her husband to start his own business as a retail store as there was no other store in their area.

I am managing a retail store with my husband. Initially, my husband took all decisions related to savings and asset purchases. But now as I am helping him in managing our retail store. He acknowledges my effort and now we collectively decide how to spend our income. I and my husband started doing all chores together now. We both listen to each other, and collectively make decisions. He respects my suggestions and decisions. As we both couldn’t get a higher education, so we have realized the importance of education. Therefore, we are sending our children to good schools for quality education. The credit for our success and better well-being goes not only to my hard work but to all including my family, friends, and also to RCDP who helped us to build up our lives once again.

We have found that after establishing their own business, women became more confident and self-empowered due to microfinance. They have developed a true belief in their entrepreneurial skills and independent decisions. These women are highly efficient as they not only make a business investment but also save some amount of money for future needs at the same time. Women use their amount of loans in smart investments in some entrepreneurial activities and in providing financial support to their families. But after becoming financially stable, they start saving money for future needs. This indicates the smart and strategic planning of women. After this phase, women are very confident in developing a strong position in their family and taking financial responsibility on their shoulders. These results also find support from past studies [ 53 , 80 ]. Women have developed a serious working attitude toward their profession and are happy for supporting their husbands and family [ 77 ]. Hence, we can say that this all has become possible due to microfinancing as it not only provides financial support to women but also encourages them to contribute positively toward the development of society. [ 44 ]. Also, it plays a prominent role in establishing entrepreneurial knowledge and independent decision-making habit in women. Despite these efforts, many areas such as quality of services and working on new skill development trades, and gender responsiveness need improvement. The present form of this paper is not gender-friendly because it has mainly targeted the female gender and the male gender seems neglected. In addition to tangible development (food access and other necessities of life), it also provides intangible development to women in the form of motivation, self-belief, self-empowerment, confidence, and independent decision making. The findings of the study are in line with William’s theoretical model of women’s empowerment as the participants expressed that they have achieved empowerment by using their resources and agency. Further, the results are also in line with the status withdrawal theory as the participants expressed that they want to become independent because they want respect in society. Hence, our results are in line with the theories.

Microfinance plays a dominant role to motivate and enhance entrepreneurial activities in any country. This study aims to examine the efficiency of microfinance in empowering women in Pakistan. The analysis and results revealed that microfinance is an effective tool that can contribute to the development of women’s empowerment and entrepreneurship. The findings also support the theoretical aspect of William’s theory as women empowerment is being discussed with a view of three dimensions including resources, agency, and achievements. The study contributed to breaking the conventional hurdles levied on women’s decisions and mobility. A developing country needs to focus on the growth and development of entrepreneurship for achieving stability. People find microfinance as an opportunity for themselves as it provides a way to enter into the entrepreneurship field. The six cases elaborated in this study reveal that the RCDP microfinance loan has been proven as a full-time and consistent earning source for the people and helped them a lot in improving their living standards. In the initial stage, the clients operated their business as sole proprietors, and over time, they involved many other people in the business. Thus, microfinance has become a potential source of earning for many needy people.

Hence, this study highlights that microfinance creates a positive and influential impact on rural women. It not only works for the betterment of women but also considers the entire families of those women by supporting them in enhancing their family earnings. In this way, this study will help in increasing the percentage of school-going children and a reduction in child labor due to an increase in family earnings. Although this project is concerned with providing small-scale services still it is contributing a lot toward the growth of Millennium Development Goals related to women’s empowerment, health, child welfare, and poverty alleviation. In light of these results, we came to know that microfinance has a diverse portfolio of benefits. It is not only a source of finance but also a tool that makes women more confident and boosts their morale. The findings indicate that even the small-scale loans taken from RCDP have helped women a lot to grow their socioeconomic and financial position through entrepreneurship which supports the theoretical foundation of the status withdrawal theory. It has benefited females with strong and independent decision-making power. Our results can help policymakers and practitioners to adopt suitable policies that assimilate empowerment in the formation of more effective projects for women. The findings of this study may encourage more women to take part in microfinance projects and entrepreneurial activities.

Limitations and future directions

This study has some limitations. The first limitation is the shortage of time that resulted in designing a moderate sample size as compared to a bigger one. Second, the data collection is done for just one city and is limited to interest-based loans, whereas it has been found that RCDP is also concerned with interest-free loan programs. Third, the study used only six detailed interviews due to the time constraint factor which indicates that the findings cannot be fully generalized as only six cases were taken into account. However, this study has a potential scope in elaborating on all the possible dimensions of the related topic and it would enhance the recognition of women’s empowerment. This paper is dynamic as it covers both practical and theoretical aspects. Keeping in mind the time limitation and resource constraints, the above-discussed six cases can serve as a good starting step to allow the researcher to explore it further and investigate more dimensions in a longitudinal analysis. This study motivates women of our country to take a positive stand and contribute their role in poverty alleviation.

By documenting the limitations of the present study, future researchers are suggested to explore certain areas. Firstly, this study primarily deals with only a single project in the context of the most modern areas of Pakistan, it is recommended to future researchers perform this study in different regions of the country. Secondly, the sample size is limited due to time limitations; hence, future researchers are advised to conduct a study on the related topic by designing a large sample size. Lastly, it would be better for researchers to investigate the sustainability of community-based development projects via localized community-based adjustments with the support of local NGOs’ involvement rather than government funding.

Availability of data and materials

The data analyzed during the current study is available from the corresponding author on reasonable request.

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Khursheed, A. Exploring the role of microfinance in women’s empowerment and entrepreneurial development: a qualitative study. Futur Bus J 8 , 57 (2022). https://doi.org/10.1186/s43093-022-00172-2

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This paper studies the relationship between microfinance, education and poverty at the macrolevel using a cross-country panel dataset of 116 countries over the period of 1999–2018. Disaggregating the effects by income levels and taking account of the potential problem of endogeneity related to microfinance institutions’ loans, this analysis reveals that any increase in the size of the gross loan portfolio of MFIs leads to a reduction in poverty in high- and middle-income economies. Moreover, I show that there is no significant relationship between microfinance and poverty in countries with lower levels of income. I also examine the channels through which microfinance affects poverty and find that any increase in the size of the microfinance sector fosters education which, in turn, reduces poverty.

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Asma Boussetta

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I would like to thank the anonymous referees and Katsushi S. Imai for the constructive remarks and suggestions that helped me to improve the paper. I also thank the participants of the 18th Annual Conference of the EEFS, the International Conference Current Economic Trends in Emerging and Developing Countries TIMTED 2019 and the 7th International PhD Meeting in Economics - Thessaloniki 2019 for insightful comments on a previous version of the paper. All remaining errors are mine.

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Archeological research at mission espada's indigenous quarters.

Three people standing by a screen and screening artifacts

Chantelle Ruidant-Hansen

While we know that Indigenous people were vital to the overall functioning, purpose, and construction of mission systems, we do not fully understand what their daily lives looked. Sources such as friar reports and oral histories help shape what their lives would have looked like. Similarly, archeology allows researchers to better understand daily life through material culture. It helps to answer questions such as: What food did people eat? What household objects did they own? What beliefs and traditions did people keep?

Electric Cars Are Suddenly Becoming Affordable

More efficient manufacturing, falling battery costs and intense competition are lowering sticker prices for battery-powered models to within striking distance of gasoline cars.

Three electric vehicles parked at a dealership. There are several yellow school buses in the background.

By Jack Ewing

Alex Lawrence, a dealer in Salt Lake City who specializes in used electric cars, has seen a change over the last year in the kinds of customers who are coming into his showroom. They used to be well-heeled professionals who could drop $70,000 on a Rivian luxury pickup truck.

Recently, Mr. Lawrence said, customers have been snapping up used Teslas for a little over $20,000, after applying a $4,000 federal tax credit.

“We’re seeing younger people,” Mr. Lawrence said. “We are seeing more blue-collar and entry-level white-collar people. The purchase price of the car has suddenly become in reach.”

Regarded by conservative politicians and other critics as playthings of the liberal elite, electric vehicles are fast becoming more accessible. Prices are falling because of increased competition, lower raw-material costs and more efficient manufacturing. Federal tax credits of up to $7,500 for new electric cars, often augmented by thousands of dollars in state incentives, push prices even lower.

At the same time, technology is improving quickly and making electric vehicles more practical. Cars that can travel more than 300 miles on a fully charged battery are becoming common, and charging times are dropping below 30 minutes. The number of fast chargers, which can top up a battery in less than half an hour, grew 36 percent from April 2023 to April 2024.

Carmakers including Tesla, Ford, General Motors and Stellantis, the owner of Jeep, have announced plans for electric vehicles that would sell new for as little as $25,000.

“The E.V. market has hit an inflection point,” said Randy Parker, chief executive of Hyundai Motor America, which will begin producing electric vehicles at a factory in Georgia by the end of the year. “The early adopters have come. They’ve got their cars. Now you’re starting to see us transition to a mass market.”

All this is good news for proponents of electric vehicles and the Biden administration, which is aiming for half of new cars sold to be electric by 2030 as part of the president’s plan to combat climate change. Even if Republicans gain control of the White House and Congress and follow through on promises to dismantle electric vehicle subsidies, they may not be able to undo the market forces pushing down prices.

“There may be some hiccups in the exact pace and scale of E.V. sales if there are major policy changes, but I wouldn’t expect the E.V. market to flatline,” said Peter Slowik, who leads research on passenger cars at the International Council on Clean Transportation, a research organization. “Most automakers are committed to an all-electric future, and many are planning on a timeline that goes far beyond the next administration.”

Electric cars, sales of which have slowed in recent months, are still more expensive than gasoline models, costing an average of $55,252 in the United States in April, according to estimates by Kelley Blue Book. That is a decline of 9 percent from April 2023, but still about $6,700 more than the average for all vehicles.

But Mr. Slowik’s group estimates that cars and sport-utility vehicles capable of traveling 400 miles on a full battery will cost less than cars with internal combustion engines in 2030, even before taking into account government subsidies. (Pickup trucks, which require bigger batteries, will take a little longer, not reaching parity for 400-mile models until 2033.)

Those calculations do not take into account lower fuel and maintenance costs that strengthen the financial argument for electric vehicles. Electricity is almost always cheaper per mile than gasoline, and battery-powered vehicles don’t need oil changes, engine air filters or spark plugs. For people who drive a lot, electric cars may already be a better deal. At the same time, some automakers are offering strong discounts on E.V. models as an enticement for buyers.

While prices are clearly trending downward, there are risks. China supplies more than half of the lithium-ion batteries used in cars sold in the United States, according to Interact Analysis, a research firm. Those batteries will become more expensive because the Biden administration announced in May that it would raise tariffs on them to 25 percent from 7.5 percent.

Many companies are building battery factories in the United States and Canada , but most of these won’t produce enough batteries to replace China for several years.

Raw materials are another risk. The price of lithium and other materials required for batteries has plunged in the last 12 months, making electric cars cheaper. But commodity prices could soar again.

The recent slowdown in the growth of electric car sales has prompted Tesla, Ford and others to delay plans to expand manufacturing. But many analysts expect sales to pick up as a glut of models pushes down prices, and as the charging network grows. High prices and the fear of not being able to find a place to recharge are the two biggest reasons people hesitate to buy an electric vehicle, surveys show.

For many people, the car’s price is not the only expense to consider. People who live in apartments often depend on public charging plugs. Public charging, besides being less convenient, tends to be more costly than charging at home.

Still, the forces pushing prices down are powerful. Manufacturing costs are dropping as traditional carmakers, who were slow to sell electric vehicles, start to apply their decades of experience with mass production to the new technology.

Later this year, for example, General Motors will begin selling an electric version of its Chevrolet Equinox sport-utility vehicle that will have a range of more than 300 miles and sell for less than $30,000 after the $7,500 federal tax credit. And the company plans to sell an even cheaper car, a new Chevrolet Bolt, next year.

The Equinox and Bolt will be built on G.M.’s Ultium platform, a collection of components that can be used for a variety of vehicles including pickups and luxury Cadillacs. G.M., which has cut costs by using the same batteries and parts for different models, has said its electric vehicles will become profitable in the second half of this year.

Electric cars still cost more to manufacture than cars with internal combustion engines, said Prateek Biswas, an analyst at Wood Mackenzie, a research firm. But costs will come down as companies learn how to produce the cars more efficiently, Mr. Biswas said — for example, by eliminating rare minerals from electric motors or replacing copper wiring with aluminum.

At the same time, the cost to make a gasoline car is rising because of stricter emissions regulations. “At some point it will be easier to just move toward E.V.s,” Mr. Biswas said.

Competition is also intensifying. Toyota and other Japanese carmakers with a reputation for delivering reliable and affordable vehicles are belatedly offering electric vehicles. Honda plans to begin producing them at an Ohio factory next year.

There will be more than 100 fully electric models for sale in the United States by next year, according to Cars.com, an online sales platform, double the number available last year. “We’re at the point now where anybody that wants an E.V. for a price point can actually get an E.V.,” said Rebecca Lindland, senior director of industry data at Cars Commerce, which operates Cars.com.

Used car prices are arguably more important than prices of new cars. Most people buy used cars. A vibrant used market vastly increases the number of people who can consider an electric vehicle.

Models from Tesla, Nissan or G.M. have been on the road for three years or more, generating inventory for dealers as the original owners buy new ones. More than half of the used electric vehicles on the market sell for less than $30,000, according to Recurrent, a research firm that focuses on the used E.V. market.

Jesse Lore, owner of Green Wave Electric Vehicles in North Hampton, N.H., recently sold a used Chevy Bolt for $15,000. After applying a federal tax credit for used electric vehicles, the price was $11,000. Besides the lure of affordable prices, he noted, his customers like that electric vehicles are quieter than gasoline models, better for the environment, and faster because an electric motor generates instant torque.

“The car is more fun than whatever they’re driving now,” Mr. Lore said.

Jack Ewing writes about the auto industry with an emphasis on electric vehicles. More about Jack Ewing

More From Forbes

Women's health pac launches: a turning point for research and care.

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Women's healthcare is on the cusp of becoming a national priority.

The creation of the bipartisan Women's Health PAC signifies a critical juncture in the movement to elevate women's health on the national political stage. Historically, this field has been underfunded and stigmatized, leading to significant knowledge gaps and disparities in healthcare. However, the landscape is changing positively with increased government funding, targeted initiatives, and a growing interest from venture capitalists.

Despite this progress, significant challenges persist. The PAC's mission is to solidify women's health as a national priority, ensuring adequate funding for every stage in the development of treatments. This momentum, fueled by recent government actions and heightened venture capital involvement, promises to drive substantial progress in women's health research and outcomes.

The ultimate goal is to achieve comprehensive health care that addresses the unique needs of all women while unlocking a potential $1 trillion annual economic opportunity.

Women's Health PAC Fights For Parity In Funding

A group of women’s health leaders recently launched the first-ever bipartisan Women's Health PAC, dedicated to making women’s health a sustained national political priority . Candace McDonald, Jodi Neuhauser, and Liz Powell co-founded the group.

Early-stage women's health research is risky but can be rewarding. Government funding bridges the gap, allowing researchers to explore promising yet uncertain avenues with high breakthrough potential. Investors often demand preliminary data before funding, creating a catch-22.

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While women represent more than half the population, the National Institute of Health allocated only $4,466 million—10.8% —of its budget to women's health research. Historically underfunded, women's health research suffers from knowledge gaps and healthcare disparities. U.S. government funding must target neglected areas, ensuring that research addresses the health needs of all populations, including marginalized and underserved groups.

Most funding decision-makers are men. By and large, they need to become more familiar with women's health challenges. “I spend a lot of time explaining things, which is very challenging,” said Elizabeth Garner, OB/GYN and Gynecologic Oncologist. Seventeen years ago, she left clinical medicine and entered the pharmaceutical industry. She is currently the chief scientific officer at Ferring Pharmaceuticals. “We need more education!”

Stigma shrouds women's health, from menstruation and menopause that only affect women to diseases that are more likely to affect women, such as autoimmune disorders and Alzheimer’s, and to diseases like cardiovascular that affect women differently than men. The taboos surrounding women’s health discourage open dialogue, making these issues seem less important and hindering research funding.

Another issue: Joanna Strober, CEO and founder of Midi Health, points out that estrogen is connected to the prevention of Alzheimer's, cardiovascular disease, osteoporosis, and osteopenia. The company provides virtual care to women 35 to 65. Due to its status as a generic drug, estrogen offers less financial incentive for pharmaceutical companies to investigate its potential benefits for these diseases. Testosterone plays a role in women’s bone health, libido, and brain health. It, too, is a generic drug with lower profit margins than patented drugs. There is no research investigating how estrogen and testosterone can be used to improve women’s health as they age.

Government grants act as seed money, enabling researchers to gather crucial data, develop prototypes, and demonstrate proof of concept, paving the way for later-stage private and philanthropic investment.

Women are underrepresented in all stages of the product development continuum, including R&D, data collection, clinical trials, founding companies, and being VCs. The result is that diseases impacting women receive less federal research funding than those affecting men.

The Women's Health PAC will ensure politicians remain focused on women's health by race and ethnicity. It will organize grassroots events, spearhead awareness marketing campaigns, provide financial support to bipartisan candidates supporting women’s health, leverage political and financial influence, and continuously focus on women’s health.

Closing Women’s Health Gap Creates $1 Trillion Opportunity

Momentum is building to address women’s health research disparity. The Biden administration has launched several initiatives to accelerate growth:

The Advanced Research Projects Agency for Health (ARPA-H) Sprint for Women's Health was announced on February 21, 2024. This initiative commits $100 million to transformative research and development in women's health.
Twenty new actions and commitments by federal agencies were announced on March 18, 2024. The agencies included the U.S. Department of Health and Human Services, the Department of Defense, the Department of Veterans Affairs, and the National Science Foundation. Notably, this includes the launch of a new NIH-wide initiative that will allocate $200 million in fiscal year 2025 for interdisciplinary women’s health research.
This effort is a foundational step towards the transformative central $12 billion Fund on Women’s Health, which the President urged Congress to invest in.

On May 9, 2024, seventeen bipartisan senators and Halle Berry announced the Advancing Menopause Care and Mid-Life Women’s Health Act , a $275 million bill to boost federal research, physician training, and public awareness about menopause.

Recognition of women's unique healthcare needs and the potential for innovation in this space are growing. Reports showing the opportunity have fueled the push for more inclusive healthcare.

Investing $300 million in women's health research could yield a $13 billion economic return —43 fold increase. (Women’s Health Access Matters conducted by the RAND Corporation)

The Case To Fund Women’s Health Research

Women globally spend significantly more of their lives in poor health compared to men. Closing this gap could improve millions of women's lives and unlock a massive economic opportunity of $1 trillion annually by 2040. (McKinsey)
There was a 314% increase in VC investment in women’s health since 2018. Innovation in Women’s Health 2023 is optimistic that the sector is poised for significantly more growth because of the growing recognition of women's unique healthcare needs and the potential for innovation in this space (PitchBook and SVB). No matter what health condition a company is focused on, Christina K. Isacson, Ph.D., partner at Lightstone Ventures, a VC firm that invests in medical breakthroughs, asks founders how they include gender in preclinical and clinical work, and product profiles. The report notes that over 76% of VC-backed women’s health companies have at least one female co-founder, a significantly higher proportion than other sectors. Female-founded companies tend to be undervalued and represent an opportunity for superior returns. Significant successes by women’s health companies have demonstrated the sector's investment potential. Midi Health, a virtual company focused on women 35 to 65, has raised $100 million. Raising the first and second rounds was difficult, commented Strober. The company relied on funding from small women-owned venture funds. The third round of funding came from larger VCs, but the lead investors were women.
A PitchBook analysis of femtech—defined as a range of health software and tech-enabled products that cater to female biological needs and a subsector of women’s health—reveals spectacular growth for female-founded companies. From 2013 to 2023, funding grew:
5829% to $450 million for solely female-founded companies.
2633% to $713.8 million for companies with at least one female founder.
114% to $124.6 million for solely male-founded companies.

“I encourage male founders to be open-minded to the opportunities that gender-based medicine presents,” said Isacson.

Launching the bipartisan Women's Health PAC marks a pivotal moment in the fight to prioritize women's health in national political discourse. Despite historical underfunding and a persistent stigma, the landscape for women's health research is transforming. More government money, focused research efforts, and a rise in investor enthusiasm suggest exciting medical breakthroughs are on the horizon. Recognizing the economic benefits and dismantling the barriers to inclusive research pave the way for a future where all women can access healthcare that addresses their unique needs.

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The S&P 500 could climb 23% next year if Treasury yields fall and AI momentum stays strong, research firm says

The S&P 500 could soar more than 20% by the end of next year, Capital Economics predicted.
That's assuming the bond market and AI continue to work in the favor of stocks.
Falling yields and continuing excitement for AI could boost the S&P 500 to 6,500, the firm said.

The S&P 500 could see another double-digit gain by the end of next year.

That's as long as the bond market cooperates and Wall Street's hype for artificial intelligence continues to work in its favor, according to Capital Economics.

The research firm predicted the benchmark index could climb to 6,500 by the end of 2025, implying a 23% gain from its current level. That's assuming that falling Treasury yields and the AI will continue to boost the market.

Reilly pointed to the recent decline in US Treasury yields, with the yield on the 10-year Treasury plunging over 50 basis points from its peak last year as investors anticipate coming rate cuts from the Fed . Falling yields are typically bullish for stocks, but that's failed to boost the market in recent weeks, as some investors have grown exhausted over the excitement for artificial intelligence .

That's likely to change, though, Reilly said, as the market is still in the early stages of the AI megatrend.

"If both of these forces combine in favor of the stock market over the next year or so, as we expect, that could be a serious tailwind for equities," Reilly said in a recent note to clients. "This expectation that AI hype will increase and that Treasury yields will fall underpins our long-standing forecast for the S&p 500 to hit 6,500 by end-2025."

Some stock market prognosticators have warned the AI-fueled rally will fizzle, or worse, that it's bound to end in a painful bursting of a bubble that has been inflating for the last two years. Investors may be overly focused on a select group of AI players, a classic hallmark of a stock market bubble , Wall Street strategists have warned.

But narrow stock market rallies have the potential to last years, Rielly said, suggesting the stock market run-up could continue for now.

"In any case, we don't expect this narrowing to persist. The dotcom bubble highlighted how hard it is to identify the beneficiaries of a new technology ex-ante. And while investors have been convinced that NVIDIA (the dominant provider of chips) and other big-tech firms were likely winners, we remain at the early stages of the AI revolution and, in our view, of the bubble."

Warnings of a market bubble have proliferated as the S&P 500 notched a series of record-highs this year. By some valuation metrics, stocks look to be at their most overvalued since 1929 , one elite investor recently warned, speculating that a stock crash of around 50%-70% isn't out of the question.

Capital Economics has also warned of a stock market correction akin to the 1929 and dot-com crashes , which could begin in early 2026.

Main content

The state of AI in early 2024: Gen AI adoption spikes and starts to generate value

If 2023 was the year the world discovered generative AI (gen AI) , 2024 is the year organizations truly began using—and deriving business value from—this new technology. In the latest McKinsey Global Survey on AI, 65 percent of respondents report that their organizations are regularly using gen AI, nearly double the percentage from our previous survey just ten months ago. Respondents’ expectations for gen AI’s impact remain as high as they were last year , with three-quarters predicting that gen AI will lead to significant or disruptive change in their industries in the years ahead.

About the authors

This article is a collaborative effort by Alex Singla , Alexander Sukharevsky , Lareina Yee , and Michael Chui , with Bryce Hall , representing views from QuantumBlack, AI by McKinsey, and McKinsey Digital.

Organizations are already seeing material benefits from gen AI use, reporting both cost decreases and revenue jumps in the business units deploying the technology. The survey also provides insights into the kinds of risks presented by gen AI—most notably, inaccuracy—as well as the emerging practices of top performers to mitigate those challenges and capture value.

AI adoption surges

Interest in generative AI has also brightened the spotlight on a broader set of AI capabilities. For the past six years, AI adoption by respondents’ organizations has hovered at about 50 percent. This year, the survey finds that adoption has jumped to 72 percent (Exhibit 1). And the interest is truly global in scope. Our 2023 survey found that AI adoption did not reach 66 percent in any region; however, this year more than two-thirds of respondents in nearly every region say their organizations are using AI. 1 Organizations based in Central and South America are the exception, with 58 percent of respondents working for organizations based in Central and South America reporting AI adoption. Looking by industry, the biggest increase in adoption can be found in professional services. 2 Includes respondents working for organizations focused on human resources, legal services, management consulting, market research, R&D, tax preparation, and training.

Also, responses suggest that companies are now using AI in more parts of the business. Half of respondents say their organizations have adopted AI in two or more business functions, up from less than a third of respondents in 2023 (Exhibit 2).

Gen AI adoption is most common in the functions where it can create the most value

Most respondents now report that their organizations—and they as individuals—are using gen AI. Sixty-five percent of respondents say their organizations are regularly using gen AI in at least one business function, up from one-third last year. The average organization using gen AI is doing so in two functions, most often in marketing and sales and in product and service development—two functions in which previous research determined that gen AI adoption could generate the most value 3 “ The economic potential of generative AI: The next productivity frontier ,” McKinsey, June 14, 2023. —as well as in IT (Exhibit 3). The biggest increase from 2023 is found in marketing and sales, where reported adoption has more than doubled. Yet across functions, only two use cases, both within marketing and sales, are reported by 15 percent or more of respondents.

Gen AI also is weaving its way into respondents’ personal lives. Compared with 2023, respondents are much more likely to be using gen AI at work and even more likely to be using gen AI both at work and in their personal lives (Exhibit 4). The survey finds upticks in gen AI use across all regions, with the largest increases in Asia–Pacific and Greater China. Respondents at the highest seniority levels, meanwhile, show larger jumps in the use of gen Al tools for work and outside of work compared with their midlevel-management peers. Looking at specific industries, respondents working in energy and materials and in professional services report the largest increase in gen AI use.

Investments in gen AI and analytical AI are beginning to create value

The latest survey also shows how different industries are budgeting for gen AI. Responses suggest that, in many industries, organizations are about equally as likely to be investing more than 5 percent of their digital budgets in gen AI as they are in nongenerative, analytical-AI solutions (Exhibit 5). Yet in most industries, larger shares of respondents report that their organizations spend more than 20 percent on analytical AI than on gen AI. Looking ahead, most respondents—67 percent—expect their organizations to invest more in AI over the next three years.

Where are those investments paying off? For the first time, our latest survey explored the value created by gen AI use by business function. The function in which the largest share of respondents report seeing cost decreases is human resources. Respondents most commonly report meaningful revenue increases (of more than 5 percent) in supply chain and inventory management (Exhibit 6). For analytical AI, respondents most often report seeing cost benefits in service operations—in line with what we found last year —as well as meaningful revenue increases from AI use in marketing and sales.

Inaccuracy: The most recognized and experienced risk of gen AI use

As businesses begin to see the benefits of gen AI, they’re also recognizing the diverse risks associated with the technology. These can range from data management risks such as data privacy, bias, or intellectual property (IP) infringement to model management risks, which tend to focus on inaccurate output or lack of explainability. A third big risk category is security and incorrect use.

Respondents to the latest survey are more likely than they were last year to say their organizations consider inaccuracy and IP infringement to be relevant to their use of gen AI, and about half continue to view cybersecurity as a risk (Exhibit 7).

Conversely, respondents are less likely than they were last year to say their organizations consider workforce and labor displacement to be relevant risks and are not increasing efforts to mitigate them.

In fact, inaccuracy— which can affect use cases across the gen AI value chain , ranging from customer journeys and summarization to coding and creative content—is the only risk that respondents are significantly more likely than last year to say their organizations are actively working to mitigate.

Some organizations have already experienced negative consequences from the use of gen AI, with 44 percent of respondents saying their organizations have experienced at least one consequence (Exhibit 8). Respondents most often report inaccuracy as a risk that has affected their organizations, followed by cybersecurity and explainability.

Our previous research has found that there are several elements of governance that can help in scaling gen AI use responsibly, yet few respondents report having these risk-related practices in place. 4 “ Implementing generative AI with speed and safety ,” McKinsey Quarterly , March 13, 2024. For example, just 18 percent say their organizations have an enterprise-wide council or board with the authority to make decisions involving responsible AI governance, and only one-third say gen AI risk awareness and risk mitigation controls are required skill sets for technical talent.

Bringing gen AI capabilities to bear

The latest survey also sought to understand how, and how quickly, organizations are deploying these new gen AI tools. We have found three archetypes for implementing gen AI solutions : takers use off-the-shelf, publicly available solutions; shapers customize those tools with proprietary data and systems; and makers develop their own foundation models from scratch. 5 “ Technology’s generational moment with generative AI: A CIO and CTO guide ,” McKinsey, July 11, 2023. Across most industries, the survey results suggest that organizations are finding off-the-shelf offerings applicable to their business needs—though many are pursuing opportunities to customize models or even develop their own (Exhibit 9). About half of reported gen AI uses within respondents’ business functions are utilizing off-the-shelf, publicly available models or tools, with little or no customization. Respondents in energy and materials, technology, and media and telecommunications are more likely to report significant customization or tuning of publicly available models or developing their own proprietary models to address specific business needs.

Respondents most often report that their organizations required one to four months from the start of a project to put gen AI into production, though the time it takes varies by business function (Exhibit 10). It also depends upon the approach for acquiring those capabilities. Not surprisingly, reported uses of highly customized or proprietary models are 1.5 times more likely than off-the-shelf, publicly available models to take five months or more to implement.

Gen AI high performers are excelling despite facing challenges

Gen AI is a new technology, and organizations are still early in the journey of pursuing its opportunities and scaling it across functions. So it’s little surprise that only a small subset of respondents (46 out of 876) report that a meaningful share of their organizations’ EBIT can be attributed to their deployment of gen AI. Still, these gen AI leaders are worth examining closely. These, after all, are the early movers, who already attribute more than 10 percent of their organizations’ EBIT to their use of gen AI. Forty-two percent of these high performers say more than 20 percent of their EBIT is attributable to their use of nongenerative, analytical AI, and they span industries and regions—though most are at organizations with less than $1 billion in annual revenue. The AI-related practices at these organizations can offer guidance to those looking to create value from gen AI adoption at their own organizations.

To start, gen AI high performers are using gen AI in more business functions—an average of three functions, while others average two. They, like other organizations, are most likely to use gen AI in marketing and sales and product or service development, but they’re much more likely than others to use gen AI solutions in risk, legal, and compliance; in strategy and corporate finance; and in supply chain and inventory management. They’re more than three times as likely as others to be using gen AI in activities ranging from processing of accounting documents and risk assessment to R&D testing and pricing and promotions. While, overall, about half of reported gen AI applications within business functions are utilizing publicly available models or tools, gen AI high performers are less likely to use those off-the-shelf options than to either implement significantly customized versions of those tools or to develop their own proprietary foundation models.

What else are these high performers doing differently? For one thing, they are paying more attention to gen-AI-related risks. Perhaps because they are further along on their journeys, they are more likely than others to say their organizations have experienced every negative consequence from gen AI we asked about, from cybersecurity and personal privacy to explainability and IP infringement. Given that, they are more likely than others to report that their organizations consider those risks, as well as regulatory compliance, environmental impacts, and political stability, to be relevant to their gen AI use, and they say they take steps to mitigate more risks than others do.

Gen AI high performers are also much more likely to say their organizations follow a set of risk-related best practices (Exhibit 11). For example, they are nearly twice as likely as others to involve the legal function and embed risk reviews early on in the development of gen AI solutions—that is, to “ shift left .” They’re also much more likely than others to employ a wide range of other best practices, from strategy-related practices to those related to scaling.

In addition to experiencing the risks of gen AI adoption, high performers have encountered other challenges that can serve as warnings to others (Exhibit 12). Seventy percent say they have experienced difficulties with data, including defining processes for data governance, developing the ability to quickly integrate data into AI models, and an insufficient amount of training data, highlighting the essential role that data play in capturing value. High performers are also more likely than others to report experiencing challenges with their operating models, such as implementing agile ways of working and effective sprint performance management.

About the research

The online survey was in the field from February 22 to March 5, 2024, and garnered responses from 1,363 participants representing the full range of regions, industries, company sizes, functional specialties, and tenures. Of those respondents, 981 said their organizations had adopted AI in at least one business function, and 878 said their organizations were regularly using gen AI in at least one function. To adjust for differences in response rates, the data are weighted by the contribution of each respondent’s nation to global GDP.

Alex Singla and Alexander Sukharevsky are global coleaders of QuantumBlack, AI by McKinsey, and senior partners in McKinsey’s Chicago and London offices, respectively; Lareina Yee is a senior partner in the Bay Area office, where Michael Chui , a McKinsey Global Institute partner, is a partner; and Bryce Hall is an associate partner in the Washington, DC, office.

They wish to thank Kaitlin Noe, Larry Kanter, Mallika Jhamb, and Shinjini Srivastava for their contributions to this work.

This article was edited by Heather Hanselman, a senior editor in McKinsey’s Atlanta office.

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Intermittent Fasting Increases Odds of Death by Cardiovascular Disease, Preliminary Research Finds

By Margaux Anbouba

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There is no such thing as a one-size-fits-all approach to health for everybody. But science and scientific studies can give us a sign that things like diets may not be as good for us as they initially appear—and intermittent fasting is the latest eating style to take a hit. (If you missed it, the ketogenic diet is also under fire .)

Intermittent fasting is the practice of restricted eating and comes with certain rules, which could include fasting in the morning or choosing to consume food only during certain hours of the day.

A recent study that followed 20,000 US adults for anywhere between 7 and 18 years found a startling statistic related to people who practice the 16:8 eating rule, which involves fasting for 16 hours every day: Those who limited their eating hours to a time frame of just eight hours a day were more likely to die of cardiovascular disease than those who spaced out their meals across 12 to 16 hours a day. And they weren’t just more likely—they faced a 91% higher risk of death. The study also found that those who spaced their meals across more than 16 hours of the day had a lower risk of dying from cancer among people with cancer.

“Overall, this study suggests that time-restricted eating may have short-term benefits but long-term adverse effects,” according to Christopher D. Gardner, PhD, FAHA. Dr. Gardner noted there are potential other details that need to be further assessed, like “the nutrient quality of the diets typical of the different subsets of participants,” and that overall this should be a starting point to further study intermittent fasting.

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Exploring the role of microfinance in women’s empowerment and entrepreneurial development: a qualitative study

Introduction

Problem statement

Significance of the study

Literature review

Measuring empowerment

Meaning of women’s empowerment

Microfinance and women’s empowerment

Social empowerment of women

Financial empowerment of women

Research gap

Research question

Theoretical framework

Status withdrawal theory

Methodology

Semi-structured interviews

Focus group

Data analysis, results, and discussion

Incorporating first-order codes with second-order themes

Accumulating the theoretical dimensions

Limitations and future directions

Availability of data and materials

Acknowledgements

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Read more about University of Texas at Austin Ph.D. candidate, Kelton Sheridan's archeological research at Mission Espada's Indigenous Quarters as she explores the answers of the questions listed above.

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The S&P 500 could climb 23% next year if Treasury yields fall and AI momentum stays strong, research firm says

The state of AI in early 2024: Gen AI adoption spikes and starts to generate value

About the authors

AI adoption surges

Gen AI adoption is most common in the functions where it can create the most value

Investments in gen AI and analytical AI are beginning to create value

Inaccuracy: The most recognized and experienced risk of gen AI use

Bringing gen AI capabilities to bear

Gen AI high performers are excelling despite facing challenges

About the research

Explore a career with us

Moving past gen AI’s honeymoon phase: Seven hard truths for CIOs to get from pilot to scale

A generative AI reset: Rewiring to turn potential into value in 2024

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Intermittent Fasting Increases Odds of Death by Cardiovascular Disease, Preliminary Research Finds

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