Saima is an unusually successful participant in the microcredit revolution sweeping the developing world. In place after place, markets and microlending are proving a powerful system to help people help themselves. Microfinance has done more to bolster the status of women, and to protect them from abuse, than any laws could accomplish. Capitalism, it turns out, can achieve what charity and good intentions sometimes cannot.

Kashf is typical of microfinance institutions in that it lends almost exclusively to women, in groups of twenty-five, who guarantee one another's debts and meet every two weeks to make their payments and discuss a social issue. Topics include family planning, schooling for girls, or hudood laws used to punish rape victims. The meetings are held in the women's homes, in rotation, and they create a "women's space" where they freely discuss their concerns. Many Pakistani women are not supposed to leave the house without their husbands' permission, but husbands tolerate the insubordination because it is profitable. The women return with cash and investment ideas, and over time they earn incomes that make a significant difference in household living standards.

Typically, the women start small, but after they have repaid the first loan in full they can borrow again, a larger amount. This keeps them going to the meetings and exchanging ideas, and it builds the habit of dealing with money and paying debts promptly.

"Now women earn money and so their husbands respect them more," said Zohra Bibi, a neighbor of Saima who used Kashf loans to buy young calves that she raises and sells when they are grown. "If my husband starts to hit me, I tell him to lay off or next year I won't get a new loan. And then he sits down and is quiet."

Excerpted from Half the Sky by Nicholas D. Kristof and Sheryl WuDunn. Copyright © 2009 by Nicholas D. Kristof. Excerpted by permission of Knopf, a division of Random House, Inc. All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.


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