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This paper engages with debates around microcredit, once a development success story, but now much critiqued. Arguing that microcredit can only be understood within the wider context of debt, we draw on ethnographic material from two villages in Tamil Nadu, to examine how microcredit through self‐help groups sits within a broader context of indebtedness among the rural labouring classes. We describe patterns and sources of borrowing among the poor, the ways in which debts are managed, negotiated and settled within households and the ways in which the management of debt is mediated by gender, caste, class and aspiration. The paper calls for a more nuanced understanding of debt: some debts are seen as 'good' and others as 'bad'. We explore the ways in which microcredit, channelled through self‐help groups, is—against much contemporary criticism—perceived by women borrowers in our study villages as a source of 'good debt' and praised as an enabling factor in their everyday household management as well as in aspirations for mobility and development. We also argue that microcredit can have positive impacts by enabling social investments that enhance status and reduce dependency. [ABSTRACT FROM AUTHOR]

The concept of 'financial inclusion' has become a central trope that legitimates a wide range of contemporary development practices. By constructing a new object of development - the 'financially excluded' - it facilitates the expansion of an increasingly corporatized microfinance technocracy. The present paper problematizes the underlying binaries of inclusion/exclusion and formal/informal finance upon which this narrative is based. Through an examination of the 2010 Andhra Pradesh microfinance crisis, it demonstrates key contradictions within the discourse and practices of commercial microfinance. In so doing, it demonstrates why the narrative of financial inclusion and its correlate notion of 'consumption smoothing' are inadequate tools with which to conceptualize the political economy of contemporary agrarian change. [ABSTRACT FROM AUTHOR]