Empowerment at the Crossroads: Opportunity as a Mediator in the Nexus Between Micro Financial Services and Women's Economic Wellbeing, Moderated by Vulnerability

Abstract

Women’s empowerment is globally recognized, with economic empowerment being a key aspect—enabling decision-making, income growth, and asset ownership. This study investigates the mediating role of opportunity and microfinance elements, along with social capital, in enhancing women’s economic empowerment. Data was collected from 205 female clients across three microfinance banks in Pakistan using closed-ended questionnaires. Employing Partial Least Squares-Structural Equation Modeling (PLS-SEM), the study reveals strong positive correlations between women entrepreneurs’ sales performance and their ability to secure loans, acquire new skills, and establish networks. Social capital plays a pivotal role in boosting business outcomes. The relationship between loan availability, savings, skill development, social capital, and bonding is mediated by opportunities for business improvement. Vulnerability moderates the relationship between opportunity and women entrepreneurs’ sales success, allowing for business expansion. Microfinance components positively impact women’s economic empowerment.