Opening the black box: What we now know about credit and poverty Sophie SirtaineKarina Broens Nielsen October 05, 2026 This page in: English

https://blogs.worldbank.org/en/voices/opening-the-black-box--what-we-now-know-about-credit-and-poverty For decades, one question has dominated debates about finance and poverty reduction: does access to credit reduce poverty? The idea that loans can help households invest in farms, businesses, or other productive activities made microcredit one of development finance's most recognizable innovations. But as evidence accumulated, the debate became increasingly polarized. Both sides keep asking the same question — and that is the problem. Credit does not have a single, universal effect that can be captured by one average result. The more useful question is not whether credit "works," but for whom, under what conditions, and for what purposes it works best.