Breaking the Bonds of Poverty: Effectiveness of Microcredit in Improving the Wellbeing of Brick Kilns’ Laborers in Pakistan

Abstract

This study examines the effectiveness of microcredit to enhance family income, eradicate peshgi and improve the wellbeing of brick kiln laborers. A survey was carried out to determine the effectiveness of microcredit among laborers working at brick kilns located in Lahore and Kasur districts. Linear regression analysis was run at 418 cases to track patterns in the data. The results of study indicated that microcredit significantly increased the family income, eradicated peshgi and improved the wellbeing of borrowers. Furthermore, segregated data indicated that female, married, aged, illiterate, beneficiaries having 6 and above children, beneficiaries having 9 and above family members, family income more than 20001, family expenditures more than 20001, beneficiaries who consulted their families and repeaters experienced higher benefits of microcredit scheme. The researchers recommend increasing the microcredit access to the poor people living in urban slums and rural areas, where the facility of formal lending institutions is lower and people are forced to take peshgi (advance) for meeting their basic needs.