Loans that Change Lives:
Interrogating Microcredit in Cambodia

Mentor: Maryann Bylander, Assistant Professor of Sociology
Students: Andrea Blobel Pérez, Peter Bradley, and Lacey Jacoby

Project Abstract 

Over the past thirty years microcredit has become firmly entrenched as a development solution throughout the Global South, offering broad promises of poverty reduction, empowerment, rural development and livelihood generation through access to small loans. Few countries have incorporated credit so rapidly into their development strategies as Cambodia. Today there is one active microcredit borrower for every two Cambodian households.

Our project interrogated the meanings of microcredit through qualitative, collaborative research in Portland and Cambodia. The project title, Loans that Change Lives, was inspired by the tagline of Kiva, a peer-to-peer lending institution that links individual donors/lenders (largely in the United States) to microcredit recipients in eighty-two countries across the world, including Cambodia.  Kiva’s website asserts that “by lending as little as $25…anyone can help a borrower start or grow a business, go to school, access clean energy or realize their potential.” Our project asked: What does microcredit mean for lenders, borrowers, microfinance institutions, investors, and development practitioners?  How do these various groups see loans as “changing lives”?  Most critically, in what ways do the meanings of credit vary across these groups?  To answer these questions we conducted qualitative research in Portland with microcredit donors, followed by interviews in Cambodia with borrowers, lenders, and development practitioners.

As part of the project we worked in collaboration with Khmer university students associated with PEPY-Empowering Youth, a Cambodian NGO based in Siem Reap. Together, we worked in teams to conduct interviews with borrowers, and to analyze our data.  We presented our findings in a participatory workshop in Siem Reap with young people coming from communities similar to those we studied. In addition, we organized an academic presentation of our findings in Phnom Penh through the Center for Khmer Studies and Human Sciences Encounters in Phnom Penh.  In all of the above we benefited from the expertise and thoughtfulness of Res Phasy, a Cambodian researcher who collaborated with the team throughout our project.

Our research raises questions about the promise of microcredit as development solution.  While many of the borrowers we spoke with described microcredit as helpful, it was equally clear that microcredit can create heightened vulnerability through debt stress.  Moreover, microcredit has limited ability to address the root causes of poverty, vulnerability and insecurity in Cambodia.  Our research also suggests that current efforts to curb overindebtedness are limited in their potential to do so. While microfinance institutions and development actors tend to frame borrowers as responsible for the “proper” use of loans, such arguments obscure the structural drivers of overindebtedness. We expect to publish a co-authored paper based on our findings, and will also be presenting our work locally in Portland, through a workshop for Sociology/ Anthropology & Asian Studies students and faculty on campus.

Lacey Jacoby

Ethnography is all about the details. For example, researching microcredit in Cambodia required something in addition to technical knowledge of finance. Understanding the relationships among borrowers, loan officers, and informal moneylenders also required a complex knowledge of context: place, history, and culture. In order to learn about each of these aspects, I spent four weeks conducting sociological research with two other students and Professor Bylander. Together, we carried out semi-structured interviews with microfinance institutions, investors, microfinance partners, financial literacy trainers, borrowers, village chiefs, commune chiefs, and non-profit organizations.

Our research went beyond these interviews, as well. It became clear to me that place and culture are foundational to every other topic, thus even the smallest observations were relevant to our research: the colors of the market, the sweetness of a rambutan, or the rhythm of a tuk-tuk ride. These sensory experiences were made even more intense by the newness of traveling to Asia for the first time. By opening me up to a broader definition of research, this trip also allowed me to grow in diverse ways: as a person, as an academic, and as a professional. This project strengthened my confidence in navigating new cultures and situations. By conducting research as part of a team, I gained hands-on experience that can be difficult to obtain in the classroom. This included building practical skills (e.g., choosing a journal to which to submit an academic article) and those that are more abstract (e.g., communicating concepts across different cultural and linguistic settings).

In the period immediately following the end of our trip, we embarked on creating an academic article from our data. We conducted secondary research to bolster our evidence, revisited our data to determine where it would lead us, and tackled the challenge of a collaboratively written paper (a first for me in the social sciences). Next, we worked together to decide where to submit our paper based on topic, tone, and impact factor. Professors generally reserve detailed, logistical discussions of the publication process for graduate programs, but with just an undergraduate education, I have already gained a hands-on understanding of how to publish my work. These skills and knowledge will carry over no matter what career I pursue, whether continuing to publish sociological articles or even just writing formal reports in the workplace. Writing well and convincing others to listen are truly invaluable skills. The process of contributing to this paper has also reshaped my timeframe for viewing this trip. More than a self-contained, one-month experience, our trip resurfaces and takes new shape each time we revisit our paper. I may no longer be physically present in Cambodia, but I continue to engage and re-engage with the individuals we met and the issues we encountered.

 In addition to the writing and publication process, this trip’s true value has emerged during the professional experiences that followed. Shortly after submitting our article for publication, I secured an interview for an internship in Tokyo, Japan with a non-profit organization called Ashinaga. Ashinaga is headquartered in Tokyo with offices throughout the world, including the United States, the United Kingdom, France, Brazil, Australia, Uganda, Senegal, etc. They provide emotional and financial support (in the form of university scholarships) to orphans. I had never visited Japan, and I do not speak Japanese. My challenge lay in convincing the team that I possessed the skills and maturity to not only live in such a new environment, but also to thrive and produce meaningful work. In making my case, I drew heavily upon my experiences in Cambodia. From the practical (I spent time navigating the city alone with a limited grasp of the language) to the theoretical (I encountered questions of higher education while working with the PEPY students), I could provide evidence of my readiness. Convinced by my preparation, the team selected me as their only intern for the winter session. I boarded a plane for Tokyo just two weeks later.

My trip to Cambodia strengthened my foundation and prepared me for the challenges I faced during my internship in Japan. It did not teach me everything I needed to know, but instead provided me the skills for working through what I don’t know—critical for travel in a new environment. I can only begin to imagine how my experiences in Cambodia will continue to re-surface and gain new significance in the months and years to come.

Peter Bradley

One of the most impactful parts of this research trip was the opportunity to see the human side of a complex issue like microfinance and over-indebtedness. After our first extensive days of interviews with microfinance borrowers in rural Cambodia, our team regrouped to discuss our findings, thoughts on, and emotional reactions to what we had heard. One of the Cambodian students told a particularly tragic story about a man who had lost his land and was indebted to two different sources after sickness and death in his family. The student was heartbroken by the story, even after growing up in a community with high levels of over indebtedness. He called it “unthinkable.” The chance to hear people’s stories, especially after extensive readings and preparation before the trip, offered a much deeper understanding of what microcredit means, and does in rural Cambodia.

The current challenge of microfinance in Cambodia centers around large-scale, unregulated growth, leading to concerns about over indebtedness among borrowers. Through our observations while in Cambodia, and analysis of existing literature, we saw that much of the responsibility for creating a healthy, well-functioning microfinance sector is placed on borrowers rather than financial institutions or the state. Because of this, solutions that have been undertaken by the sector remain limited in their scope.

As I hope to go into the field of experiential education, the interpersonal skills and cross-cultural exchange skills I developed on this trip will help me as I pursue that goal. I also made meaningful and lasting connections with the Cambodian PEPY students we worked with.

I developed concrete research skills during my work on the project that have helped me in my academic career at Lewis & Clark. In the months preparing for our time in Cambodia and the months following, I had countless opportunities to learn research strategies from Professor Bylander and the other members of my team. My academic writing also developed during our process of writing an article about our research. During the last semester, I began work on my thesis and took three intensive Sociology and Anthropology courses. In all of these courses I was able to draw on my research and writing skills I had advanced as a result of the research trip. It was a rewarding experience to feel confident navigating online databases and knowing how to dig deep to find valuable sources. Additionally, my thesis topic relies on qualitative research methods, which was our primary research technique while in Cambodia. I felt better prepared to start my interviews after getting so much hands-on experience this summer. My thesis research is an ongoing process that will continue into the next semester and I am excited to continue to use the skills I started to hone last summer.

Overall my time in Cambodia, in addition to all of the preparations and work after on our final products has left me feeling better prepared in my personal life, where I hope to continue travelling and seeing more of the world. It has also left me better prepared for the duration of my undergraduate academic life, as I continue work on my thesis. Finally, it has left me with a set of interpersonal communication skills that apply directly to my professional life working in experiential education.

Andrea Blobel Pérez

This research represented for me the opportunity to absorb experiences like a sponge: I wanted to learn Khmer language, study more about Cambodia’s history, investigate the “new development solution of microfinance institutions,” and see in action the professor who inspired me to be a sociologist. These four points were my personal takeaways from my time in Cambodia. What made this trip so important to me was the firsthand experience I gained doing research. I was able to understand different interview techniques and strategies, work collaboratively with Cambodian university students, and work as part of a team to become a better researcher. Even months after the project, I have continued learning and been involved in creating the end product of our work: a co-authored article for an academic journal. I have found this experience empowering because I have gained skills by seeing the different techniques of my peers and Dr. Bylander in interviewing, writing, communicating, understanding and thinking critically.

During our project we learned a great deal about the workings of microfinance. Beyond our project findings, the question that followed me throughout this research was one posed to us by a microfinance manager: Why are microfinance institutions only in poor countries? This is a question I hope to investigate beyond this SFF project. Thus, I think it is important to emphasize that this project not only gave me useful skills for the future, but also exposed me to a sector, a region, and a set of questions that were not in my vocabulary before. I am much more confident and better equipped to work on my current independent research thanks to the skills gained during this trip. In addition, I feel very lucky to have been part of this project because it also allowed me to get a glimpse of Cambodia: from visiting the Killing Fields and understanding Cambodia’s history, to embracing the smiling and welcoming faces of our host families.

This project allowed me to gain many practical and professional skills that I continue to apply in other independent projects. For instance, after our project in Cambodia, I did independent research in Chile, conducted interviews and collected data. The feedback from Professor Bylander and my peers during our group or independent interviews in Cambodia, allowed me to confidently plan, make mistakes, and conduct interviews in my independent research in Chile. The process of writing our paper was very fruitful because it did not only allow me to gain writing skills but I also gained a better understanding of academic writing. This was especially important for me because later that year I presented at the American Anthropological Association in Washington D.C. my independent research of Chile in an academic environment. Thus, having gained confidence on academic language and experience in presenting our project in various instances allowed me to be an even more confident presenter.

Moreover, I really appreciate when this project comes up informally in personal conversations with my family, friends, and random people I meet. In these instances I get not only to appreciate the great opportunity that was given to me but I also get to embrace the personal encounters we had with people in Cambodia and their stories, and the adventures and moments we experienced together as a research team.

For instance, when I see a news report about Cambodia and I am able to understand its context due to our project, I am curious and happy to recognize that I am interested in knowing more about issues in Cambodia. It may seem small, but it is important to recognize that by being part of this project, my curiosity for microcredit and Cambodia has grown due to the interactions and experiences lived there. I like looking at this project as a growing process that continues being present in my life in whatever I engage into.