Microcredit and entrepreneurship: Bridging intentions and actions

This study examines how microcredit shapes women's entrepreneurship by distinguishing between entrepreneurial intention formation and its translation into action. A randomized controlled trial with 348 women in Bangladesh shows that microcredit has neither a direct effect on entrepreneurial intentions nor an indirect effect through their key antecedents—personal attitudes, perceived behavioral control, or perceived social norms. Microcredit exerts its influence at a later stage by enabling women with pre-existing intentions to enter entrepreneurship. Thus, fostering women's entrepreneurship requires complementing financial access with interventions addressing underlying cognitive and normative drivers, particularly perceived social norms—the strongest antecedent of women's entrepreneurial intention in patriarchal contexts. • Microcredit does not influence women's entrepreneurial intention formation. • Microcredit strengthens the translation of entrepreneurial intentions into action. • Restrictive social norms are a central constraint on women's entrepreneurial intentions.