Government-Owned Micro-Banking and Financial Exclusion : A Case Study of Black Business People in East Port of Spain, Trinidad and Tobago

Microfinance is commonly known as banking upside down because micro-lending institutions makes very small loans available to business people excluded from conventional banks. Microfinance has piqued the interest of political elites in many global South countries because of its support by the poor masses. The case of the Trinidadian microfinance sector shows that the state dominates the micro-lending sector through its agency the National Entrepreneurship Development Company (NEDCO). The main argument for this paper is that government-owned microfinance is in fact ‘political microfinance' because of its exclusionary tendency of the small business people in the slums of east Port of Spain. On the ground, the current party politics has fuelled the perception that persons of African descent are the most excluded from accessing a small loan. However, this paper finds that no matter the party in power, the state has co-opted NEDCO to make loans available to its own party supporters and this practice goes against the microfinance sector's goal of inclusive finance