#OpenBadges – Micro-credentials: what can we learn from micro-credits?

“The best way to find out if you can trust somebody is to trust them.”
― Ernest Hemingway

Are micro-credentials a disruptive innovation, just as micro-credits (micro-loans) were thought to be a few years ago? To answer this question we should first find out what can be qualified as a disruptive innovation? According to Wikipedia:

A disruptive innovation is an innovation that helps create a new market and value network, and eventually disrupts an existing market and value network (over a few years or decades), displacing an earlier technology.

Open Badges are creating a new market, the market of Open Credentials (micro-credentials are just one type of Open Credentials) and establishing a new currency, or more precisely reinvigorating one of the oldest currencies ever: trust.

Trust has many properties. First, it’s free and when offered, it enriches both the giver and the recipient. And when the recipients of trust get richer (with trust), their increased wealth can trickle back to those who initiallyoffered their trust. While it might still need the philosophers’ stone (link) to be transmuted into gold, trust can nevertheless be transformed into real cash as one experiences when applying for a loan. Con artists and banks* also know how to make cash out of trust!

For the poorest, things are different. One of the few assets they cannot be totally deprived of is trust. Thanks to the Nobel Prize winning Grameen Bank (link) founded by Muhammad Yunus, they now have the power to convert trust into micro-loans.

Grameen Bank is owned by the borrowers and it is based on trust. It does not require any collateral from its borrowers. Since the bank does not wish to take any borrower to the court of law in case of non-repayment, it does not require the borrowers to sign any legal instrument.

Were micro-credits transformative?

What lessons could the Open Badge practitioners learn from the Grameen Bank and the many micro-credit organisations that have been spawned since its creation? Can we draw a parallel between micro-credits and micro-credentials in terms of empowerment and potential social transformation? Could Open Badges create the conditions for the emergence of a new economy?

To provide a response to these questions, we should first take a look at what really happened with micro-credits. Were they really so successful? In a 2011 article, Is microfinance a neoliberal fairytale? The Guardian (source) reported on a paper written by the Cambridge economist Ha-Joon Chang and Milford Bateman – one of microfinance’s most vociferous critics according to The Guardian:

Microfinance is based on an attractive but false premise that poor people can make themselves richer providing they have access to credit. But wealth creation, outside of fairytales, is very rarely the result of individual effort. Rather it is a collective endeavour – requiring skills and knowledge – in institutions such as companies, co-operatives. Microfinance has erroneously put the individual centre stage, reflecting a neoliberal world view.

For Milford Bateman, “[microfinance] disempowers the poor by deliberately restricting their ability to use their ‘collective capabilities’ to effect real pro-poor change” (source).

Another research paper from MIT’s Abdul Latif Jameel Poverty Action Lab (source) did find that

While microcredit “succeeds” in affecting household expenditure and creating and expanding businesses, it appears to have no discernible effect on education, health, or womens’ empowerment.

While the Stanford Social Innovation Review (source) reports:

China, Vietnam, and South Korea have significantly reduced poverty in recent years with little microfinance activity. On the other hand, Bangladesh, Bolivia, and Indonesia haven’t been as successful at reducing poverty despite the influx of microcredit.

So, while it is a fact that trust is convertible into cash, it might not be enough to have the transformative effect one could have initially expected. Are the beneficiaries of micro-credentials really empowered? Are they in a position, and do they have the power to act? Could our growing belief in micro-credentials become an impediment to proper transformative actions that might require collective action? In focusing our attention on micro-credentials, are we not committing the same kind of methodological error as those focusing on ‘security’ when it is ‘trust’ that is at stake**?

Of course, comparaison n’est pas raison (comparison is not reason), but if there is one thing we should learn from micro-credits it is that there is a wide gap between the tales we like to hear and the more prosaic reality. Only proper research can help us debunk the emerging myths of micro-credentials.

More about the similarities between micro-credentials and micro-loans

Traditional institutions take over

While originally initiated outside of the traditional banking system, now, several commercial banks have integrated micro-loans as part of their regular service provision.

[…] commercial banks are playing an increasingly important role in many financial services markets across the world. Compared with many existing providers of microfinance, commercial banks have potential competitive advantages in a number of areas, such as recognizable consumer brand names, existing infrastructure and systems, and access to capital. source

Similarly, Open Badges, that were born out of the need to recognise informal learning are now part of the institutional paraphernalia along with grades and exams. The ‘informal’ element is still present but the formal element is in the process of taking over as we have mainly focused our attention on the formal recognition of informal learning while too little efforts have been devoted to the informal recognition of informal learning.

The informal recognition of informal learning was impeded by the asymmetry of the Open Badge Infrastructure where the institutions, as issuers, were at the centre of the ecosystem and the learners and citizens at the periphery — this should change with the Open Passport…

The fallacy of empowerment

As elicited in several studies, micro-loans have done little to empower the poor. Empowerment is about the power to act, to read (Freire) and write the world, something only possible through collective and organised action.

The problem with a number of writings claiming that micro-credentials ’empower’ people is that they are no more than “make believe.” Where is the evidence?  In a recent post, Micro-Credentials: Empowering Lifelong Learners (link), the author suggests:

To have value beyond a teacher’s blog or Twitter feed, digital badges need to have both rigor and market worth. They need to become micro-credentials. […]
Rigor can be achieved if leaders work together to develop competency and assessment frameworks to ensure high standards. A system filled with “junk” badges will have far less integrity than one filled with micro-credentials awarded by reputable organizations.

Where is the place for empowerment in this description? Where even is innovation? The ‘rigor’ of credentials delivered by ‘reputable organisations’ has been there for a very long time! This sounds more like a declaration of allegeance to the existing system, than the identification of a breach where a bit of power could be seized! As Thomas Archibald and Arthur L. Wilson remark “power has often ironically been omitted from discussions of empowerment.” (link)

While one would need more than a single post to explore fully the notion of empowerment, it is probably possible to provide the elements for demonstrating a minimum of ‘rigor’ to those who want to make any reference to empowerment.

In the Pedagogy of the Oppressed, Paulo Freire, who is often quoted for his work on empowerment wrote:

Education either functions as an instrument which is used to facilitate integration of the younger generation into the logic of the present system and bring about conformity or it becomes the practice of freedom, the means by which men and women deal critically and creatively with reality and discover how to participate in the transformation of their world

What is central to empowerment is the question of power, its distribution and redistribution.

According to Ellsworth (1989), the approach to empowerment in critical pedagogy “treats the symptoms but leaves the disease unnamed and untouched”. She outlines three strategies employed by proponents of critical pedagogy which ostensibly share, give, or redistribute power to learners, all of which strike her as inadequate:

(1) mutual reflective examination by teacher and student,which she dismisses as problematically over-dependent on rationalism;

(2) re-learning of the objects of study by the teacher as she or he learns them with the student—which is still explicitly designed to bring the student’s understanding “up” to the level of the teacher, leaving “the implied superiority of the teacher’s understanding … unproblematized and untheorized”; and

(3) acknowledgment of the inevitably directive and authoritarian nature of education and judgment of acceptable and unacceptable power imbalances, where “the question ‘empowerment for what’ becomes the final arbiter of a teacher’s use or misuse of authority”.

The problem with this third strategy, according to Ellsworth, is that critical pedagogues tend to answer that final question “in ahistorical and depoliticized abstractions” (p. 307). She claims that defining empowerment in broad humanist terms (as “a capacity to act effectively”) interrupts its ability to challenge social or political positions, institutions, or groups.

(Rethinking Empowerment: Theories of Power and the Potential for Emancipatory Praxis, Thomas Archibald & Arthur L. Wilson Cornell University: link).

What Micro-Credentials: Empowering Lifelong Learners talks about has no relation whatsoever with empowerment: it simply describes the use of micro-credentials in a (power) system where learners ’empowerment’ consists of begging to be recognised by “reputable organizations.”

Provisional conclusion

Micro-Credentials: Empowering Lifelong Learners  is just one of many articles making unjustified claims relative to micro-credentials (or Open Badges) and empowerment. While not (yet) as numerous as those claiming (falsely) that micro-loans ’empower’ the poor, they are on the rise…

While it is possible that micro-credentials make those who earn them ‘happy’, or provide opportunities “in the present system,” there is a wide gap between looking at the world while being happy from reading the world to understand it and re-write it.



* Banks have the power to create money out of nothing: 97% of all the money in the economy is in bank deposits, while only 3% is in cash, i.e. printed by central banks source

​** OpenBadges: The Deleterious Effects of Mistaking Security for Trust link

NB: This blog post was originally written for the ePIC 2015 April newsflash (link) and further extended.

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