Darbhanga: A recent report by “The Hindu” reveals how microfinance, once introduced to empower women in Bihar’s villages, has spiraled into a system of crushing debt and despair. Instead of bringing stability, the scheme has left many families trapped in loans that consume their limited incomes and peace of mind.
In Bijuli village near Darbhanga, 38-year-old Sanjula Devi recalls her first microfinance loan of ₹20,000 from Fusion Bank in 2012. She borrowed to repay earlier debts and later took more loans from multiple lenders, including Jeevika and Belstar, totaling nearly ₹4 lakh. Her husband, unable to bear the mounting pressure from recovery agents, ended his life. Sanjula continues to work as a daily-wage earner, struggling to support her children while repayments never cease.
Bihar accounts for the largest microfinance portfolio in India, with outstanding loans of ₹57,712 crore as of March 2025, according to the Bharat Microfinance Report by Sa-Dhan. Social workers say most borrowers do not understand the loan documents or interest terms and receive no financial literacy training.
Anita Devi from the same district borrowed ₹1.25 lakh for her son’s wedding and now faces daily visits from collectors who wait outside her home until she pays. Another borrower, Shila Devi, took loans for her husband’s medical treatment but remains caught in an endless repayment cycle.
Women in these villages continue to take new loans to repay old ones, surviving under constant financial strain. As elections approach, promises of empowerment ring hollow in Bihar’s debt-burdened households.
