This paper begins by examining some of the theories on microfinance and its potential to bring about empowerment. Drawing on the case of the fishermen village Pudupattinam (Tamil Nadu, India), the paper looks at what evidence is known about the impact of microfinance (provided by a local NGO) on women’s life, in terms of empowerment both at the household level and within the community. It argues that, while acknowledging that the last decade, and particularly in the aftermath of the tsunami laid grounds for a changing society in which the roles of women have slowly started to expand, it is because of the microcredit scheme that women now have access to employment opportunities. In this study it is argued that while the programme has contributed to the empowerment of women as individuals (more welfare, increased self-reliance and self-esteem, more bargaining power and overall reduction in unequal power structures at the household level), the contribution to empowering women within the community has been modest, due to social and cultural norms that continue to confine women’s economic activities to the domestic sphere.