COMMUNICATION IN MICROFINANCE
An Exploratory Case Study

Irina Gendelman and Giorgia Aiello
University of Washington

Methods

Our study of communication in microfinance is a case study in two parts. The first part examines PlanetFinance’s mission statement and use of forms of communication such as the internet to convey a certain vision about microfinance, while the second part is focused on the microcredit activity of Fundachiapas. A particular emphasis is placed on this second part of the study, which relates to the fieldwork we conducted in Tapachula (Chiapas, Mexico) between April 25th and 27th 2003.

We believe that case study research fits our research goals particularly well, because it offers a replicable research model while also valuing contextual and idiosyncratic aspects, such as historical, political and cultural background. For our study, we follow Yin’s (1994) case study research model, with a special emphasis on his definition of case study as an empirical inquiry that “investigates a contemporary phenomenon within its real-life context” especially when “the boundaries between phenomenon and context are not clearly evident” (Yin, 1994, p. 13).

The “contemporary phenomenon” examined in our study is the relationship between microfinancing institutions and their beneficiaries (international NGO vs. grassroots organization and grassroots organization vs. local small entrepreneurs). The “real-life context” of the examined phenomenon is made of two main aspects. First of all, we take into account the existing relationship between an international (European) NGO and a local (Mexican) organization operating in microfinance. Secondly, we examine the current activity of the local organization and its relationship to its clients.
We also take into account the broader context of Chiapas, which is the poorest area of Mexico and it has been perceived by some as the most backward region. Chiapas, however, provides a lot of the labor force for developed nations, as well as supplied resources and products such as lumber, coffee, beef and labor power through migration (Cleaver, 1995). Because of the poverty, people have little ability to get credit from regular banks. A recent New York Times article on microfinance institutions in Mexico points out that banks in Mexico “almost never serve the middle class or the poor, rarely if ever providing them with savings accounts, much less loans or credit” (Weiner, 2003).

At the international level, Chiapas is perceived as a symbol of poverty and struggle, and international NGOs, especially European ones, like PlanetFinance, demonstrate a special interest in this region of the world. To some Chiapas represents a region that has actively struggled and resisted the hegemony of land-owners and IMF globalizing development practices. Chiapas is perceived internationally as a symbol of both poverty and local resistance to globalization. We find this context of Chiapas within the activity of a European international NGO to be an extremely significant terrain for a case study of communication in microfinance.

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