Social Capital and Group-Based Microfinance Program: Some Lessons from Acord-Dire Dawa, Eastern Ethiopia

Abstract

 GroliJrbased Micrajinance, extending small loans for i1lcome
generating activities to the poor in predomillamly developing cOlllltries, has
become olle of the most talked-about developmental lools to appear in the
lasl few years. III this paper we explore the fOllr dimensions of social
capital: Social Integratioll. Linkages, Synergy and Organizational Integrity
and their relevance to Group- based micro finance program. The concepts of
Social Integration and Linkages are defined as boltom- up forms of social
capital at the community level, while Synergy and Organizational /Illegrity
are treated as tOp-dOWII forms of social capital. This paper argiles thaI
ACORD's approach to providing microjillance to the poor through socially
sustainable community-based organizations (CBOs) is entirely consistent
with economic sociological theory of developmelll, alUl offers one model
that the familiar goal of 's/lswinability' be rethought to incorporale a social
dimension.