The lords of poverty? Micro-credit institutions and social reproduction in South Africa
The broader conception of poverty as ‘quality of social reproduction’ demonstrates the delicate nature of the interaction between the institutions of the family/household, the economy and the state. These institutions interact in the dispensation of individual, productive and collective consumptions important for social well-being and social reproduction in society. The gap in the configuration of these consumptions relationship opens the space for the institution of micro-credits to thrive in South Africa to the detriment of adequate ‘quality of social reproduction’ especially for people living in ‘poverty range’ or ‘precarious prosperity’. The lack of comprehensive social policy regime provides the recipe for the consumption of micro-credit at the desperate, need and choice dimensions, in order to close the gap between income and consumption needs to facilitate social reproduction of concerned family/households. Micro-credit consumption is viewed as an individual response, in the absence of collective consumption in the form of social policy, to smoothen individual consumption, and to cater for the strain or challenges of social reproduction. The implications of this, for concerned family/households, are imperative to how poverty is perceived, hence, the question ‘the lords of poverty’? In addition to the income and expenditure conception of poverty, the understanding of poverty dynamics will be enriched by engaging with the method through which the poor and ‘precarious prosperous’ (people living within ‘poverty range’) respond to the gap between their income and expenditure to finance shortfalls in their consumption needs. The relief sought from micro-credit (the focus of this study) to finance the gap in consumption needs can alleviate poverty, and at the same time perpetuates it through chronic indebtedness. The patronage of micro-credit in the form of cash loan, retail goods credit and informal micro-credit in the way people living within the ‘poverty range’ live their lives, as well as the activities of micro-credit institutions are highlighted in this study. Consumer credit consumption has become such a permanent feature of the social reproduction efforts of individual households in South Africa that it is crucial to understand the broader institutional interaction that may account for this. Further, it is important to understand how the patronage of consumer credit impact on the need that prompted it in the first place and other implications that may speak to the quality of social reproduction of households. These are the core problematics that are engaged in this study. The relationship between poverty (as well-being) and the consumption of micro-credit is considered within the broader framework of political economy. The effects of predatory institutions, such as microcredit, could be significant for the quality of social reproduction of households.