Journal articles on the topic 'Microfinance – Developing countries – Evaluation'
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Wijayantini, Bayu, Maheni Ika Sari, and Alfi Arif. "PERFORMANCE EVALUATION OF COMMUNITY MICROFINANCE INSTITUTIONS IN JEMBER DISTRICT." Review of Management and Entrepreneurship 2, no. 1 (September 24, 2019): 61–74. http://dx.doi.org/10.37715/rme.v2i1.953.
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Community Micro Finance Institution (CMFI) plays a significant role in alleviating poverty, which is the biggest problem in developing countries. This study aims to examine the phenomenon of CMFI development in Jember. This study is conducted using a descriptive statistical analysis and through literature study from literatures relevant to the research theme. The results of the study show that financial performance proxied by ROA has a different trend from total assets and government subsidies. ROA tends to decline even though there are some CMFIs that show good performance. This is contrary to the development of CMFI’s total assets which tend to increase throughout Jember, while government subsidies are still accepted in the same amount as intended from year to year.
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Nair, Malavika, and Martha Njolomole. "Microfinance, entrepreneurship and institutional quality." Journal of Entrepreneurship and Public Policy 9, no. 1 (January 13, 2020): 137–48. http://dx.doi.org/10.1108/jepp-07-2019-0061.
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Purpose The purpose of this paper is to consider the success and failure of microfinance institutions in generating economic growth over the past 30 years and propose a dual criterion of evaluation. Design/methodology/approach It surveys the empirical literature on microfinance and finds that while there has been small and localized success in various countries in improving access to credit, at the same time there has been a broader failure to generate economic growth. The authors argue that this broader failure should be viewed from the viewpoint of institutional failure or the lack of supporting institutions such as private property rights and stable rule of law within developing countries. Findings Using Baumol’s (1968) theory of entrepreneurship, the authors argue that the broader failure of microfinance is a case of poor institutional quality leading to unproductive or even destructive entrepreneurship rather than productive entrepreneurship. The paper also suggests a link between the literature criticizing foreign aid and this view on microfinance. Originality/value The paper provides a survey of the empirical literature on micro finance as well as a novel framework that aids in understanding both the localized small-scale success as well as broader failure to generate economic growth.
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Anku-Tsede, Olivia. "Microfinance intermediation: regulation of financial NGOs in Ghana." International Journal of Law and Management 56, no. 4 (July 8, 2014): 274–301. http://dx.doi.org/10.1108/ijlma-07-2012-0025.
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Purpose – This study aims to seek to fill a gap in regulatory impact assessment in developing countries by presenting an analysis of how formal regulation impact on the efficiency and productivity of financial non-governmental organisations (FNGOs) in Ghana. Much has been written about the formal financial sector, but very little is known about the lower end of microfinance and the impact of formal prudential regulation on FNGOs providing microfinance services. The Bank of Ghana (BOG), nevertheless, in the year 2011, extended formal prudential regulation to FNGOs without any empirical basis. This study uses regulatory theories and empirical evidence to aid in the evaluation of whether formal prudential regulation is appropriate for FNGOs operating within the microfinance sector. Design/methodology/approach – Empirical evidence derived from FNGOs, regulatory agents, consumers and financial lawyers within the Greater Accra and Ashanti Regions of Ghana served as the basis of the analysis in this study. Descriptive statistics, frequency counts and percentage scores, were used to analyse the data collected. Findings – The existing structures of FNGOs in Ghana are unsuitable for formal prudential regulation. The BOG does not have adequate staffing and funding to supervise and monitor the microfinance activities of FNGOs. Formal prudential regulation could impede growth and efficient delivery of microfinance services. Research limitations/implications – The BOG is the only regulatory agency responsible for regulating the financial market in Ghana, thus access to officers with knowledge in the regulatory regime was very limited. Practical implications – The study revealed in depth information about FNGOs, microfinance and the impact of formal prudential regulation on FNGOs. Originality/value – The study is the first to use empirical studies and theories of regulation to assess the impact of extending formal prudential regulation to FNGOs in Ghana. Data from the regulator, the regulated and consumers, the key players in any regulatory process, served as the basis of the analysis in the study resulting in the unravelling of in-depth information on the regulation of FNGOs.
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Marr, Ana, Anne Winkel, Marcel van Asseldonk, Robert Lensink, and Erwin Bulte. "Adoption and impact of index-insurance and credit for smallholder farmers in developing countries." Agricultural Finance Review 76, no. 1 (May 3, 2016): 94–118. http://dx.doi.org/10.1108/afr-11-2015-0050.
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Purpose – The purpose of this paper is to review the most recent scientific literature on the determinants explaining the demand for index-insurance, the impact of index-insurance and the existing links between insurance and credit. In this meta-analysis, the authors identify key discoveries on the potential of index-insurance in enhancing credit supply for smallholders and thus farm productivity. Design/methodology/approach – Following a systematic literature search in Scopus and Web of Science, relevant empirical articles were identified by using the following criteria search algorithm: “insurance” and (“weather” or “micro” or “area?based” or “rain*” or “livestock” or “index”), and ((“empiric*” or “experiment” or “trial” or “RCT” or “impact”) or (“credit” or “loan*” or “debt” or “finance”)). The authors identified 1,133 related papers, 110 of which were selected as closely matching the study criteria. After removing duplicates and analysing each document, 45 papers were included in the current analysis. The framework for addressing insurance and credit issues, in the paper, entails three subsequent themes, namely, adoption of insurance, impact of insurance and links between insurance and credit. Findings – It is not confirmed yet that demand for insurance is indeed hump-shaped in risk aversion and the functional form of this relationship should be tested in more detail. This also holds for the magnitude of the effect of trust and education on actual demand. Furthermore, it is unclear to what extent other risk mitigation strategies form complements or substitutes to index-insurance. Lastly, the interaction between basis risk and price is important to the design of index-insurance products. If basis risk and price elasticity are indeed highly correlated, products that diminish basis risk are crucial in increasing demand. On the impact of bundled products, e.g. combination of insurance and credit, limited empirical research has been conducted. For example, it is unknown to what extent credit suppliers would react to the insured status of farmers or what the preferences of farmers are when it comes to a mix of financial products. In addition, several researchers have suggested that microfinance institutions or banks could insure themselves against covariate risk, yet no empirical evidence about this insurance mechanism has been conducted so far. Research limitations/implications – The authors based the research on scientific literature uploaded in Scopus and Web of Science. Other potentially insightful grey literature was not included due to lack of accessibility. Given the research findings, there is plenty of opportunity for further research particularly with regard to the effects of bundled products, e.g. insurance plus credit, on demand for index-insurance, supply of credit, loan conditions and impact on farm productivity and farmers’ well-being. Practical implications – Microfinance institutions, insurance companies, NGOs, research institutions and universities, particularly in developing countries, will be interested to learn about the systematic review of scientific research done in the area of insurance and credit for agriculture and the possibilities for application in their own practice of supplying these financial products. Social implications – A rigorous understanding of the potential of index-insurance and credit is essential for identifying the right mix of financial products that help smallholder farmers to increase farm productivity and their own well-being. Originality/value – The paper is valuable due to its rigorous evaluation of existing theoretical and empirical research around issues explaining the degree of adoption and impact of index-insurance and that of bundled financial products (i.e. index-insurance plus credit). The paper has the potential to become essential reading for academics, practitioners and policy-makers interested in researching and putting in practice the best options leading to greater farm productivity and well-being in developing countries.
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Pawlak, Katarzyna. "Developing Microfinance in Post-Communist Countries." Finance & Bien Commun 20, no. 3 (2004): 14. http://dx.doi.org/10.3917/fbc.020.0014.
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Visconti, Roberto Moro. "Microfinance vs. traditional banking in developing countries." International Journal of Financial Innovation in Banking 1, no. 1/2 (2016): 43. http://dx.doi.org/10.1504/ijfib.2016.076613.
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Musanganya, Isabelle, Chantal Nyinawumuntu, and Pauline Nyirahagenimana. "THE IMPACT OF MICROFINANCE BANKS IN RURAL AREAS OF SUB-SAHARAN AFRICA." International Journal of Research -GRANTHAALAYAH 5, no. 9 (September 30, 2017): 80–90. http://dx.doi.org/10.29121/granthaalayah.v5.i9.2017.2201.
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Many researchers consider microfinance as a tool for poverty reduction. Even more, especially in post-conflict African countries, micro-financial institutions are seen as an opportunity of reconciliation. Lending from microfinance institutions to that from traditional banks and examine their respective effects upon economic growth has been practiced in some sub-Saharan countries. Considerable progress in research has been found that microfinance loans raise growth comparatively to that of traditional banks. A lot of number of researches carried out in sub-Saharan countries even in other developing countries outside of Africa did not find strong evidence that bank loans raise growth. There is, however, some evidence that bank loans do increase investment, whereas microfinance loans do not appear to do so. Differently, other researchers highlighted clearly that microfinance can provide its contribution on poverty reduction and better access to finance needed for startup micro-entrepreneurs along the world. These results suggest that microfinance loans are not primarily invested as physical capital in developing countries, but could still augment total factor productivity, whereas banks may have been financing non-productive investments. Herein, we highlighted the impact of microfinance banks on developing countries economic growth. We also indicate how microfinances system incorporated in rural areas boosted the lifestyle of poor people in Sub-Saharan Africa.
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Saeed, Muhammad Sajid. "Microfinance Activities and Factors Affecting the Growth of Microfinance in Developed & Developing Countries." International Finance and Banking 1, no. 1 (April 13, 2014): 39. http://dx.doi.org/10.5296/ifb.v1i1.5473.
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Microfinance Institutions (MFIs) have served millions of poor people around the world by offering them small loans with easy repayment terms. This review paper highlights the microfinance activities performed by the MFIs and also indicates the critical factors that hinder the growth of microfinance in developing and developed nations. It is found that the foremost factors obstructing the adoption of microfinance are: lack of financial stability, uncontrolled growth, cultural and value impede, systematic frauds, bureaucratic obstacles, state intervention, methodological defects, and shortage of credit rating agencies.
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Visconti, Roberto Moro. "Global recession and microfinance risk governance in developing countries." Risk Governance and Control: Financial Markets and Institutions 1, no. 3 (2011): 17–30. http://dx.doi.org/10.22495/rgcv1i3art2.
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Global recession, started in 2008, is still proving an unresolved perfect storm and the financial crisis has affected also the real economy, creating widespread social unrest. Microfinance institutions (MFIs) in developing countries seem however less affected by the worldwide turmoil, due to their segmentation and resilience to external shocks. Recession has a big impact on governance mechanisms, altering the equilibriums among different stakeholders and increasing the risk of investment returns; any governance improvement is highly welcome and recommended. No governance, no money for growth or bare survival. In the confused phase we are living in, at the moment there are not evident winners, but the underbanked poorest, unless properly supported, once again risk being the ultimate losers.
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Meyer, Richard L., and Geetha Nagarajan. "Microfinance in developing countries: accomplishments, debates, and future directions." Agricultural Finance Review 66, no. 2 (November 2006): 167–93. http://dx.doi.org/10.1108/00214660680001186.
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Bhatt, Nitin, and Shui-Yan Tang. "Delivering Microfinance in Developing Countries: Controversies and Policy Perspectives." Policy Studies Journal 29, no. 2 (May 2001): 319–33. http://dx.doi.org/10.1111/j.1541-0072.2001.tb02095.x.
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Nkwocha, Obinna Udodiri, Javed Hussain, Hatem El-Gohary, David J. Edwards, and Ernest Ovia. "Dynamics of Group Lending Mechanism and the Role of Group Leaders in Developing Countries." International Journal of Customer Relationship Marketing and Management 10, no. 3 (July 2019): 54–71. http://dx.doi.org/10.4018/ijcrmm.2019070104.
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Group lending mechanisms have increasingly become popular among microfinance providers in recent years. This is largely due to its ability to leverage joint liability to increase loan repayments whilst promoting an entrepreneurial spirit among borrowers. Meanwhile, a group-lending mechanism is also very important in promoting women's empowerment through cooperative engagements of all group members. However, the effectiveness of the group lending methodology in the delivery of microfinance within a developing country context is largely under-researched. Using data from extensive focus groups interviews of women borrowers held in Nigeria among participants from 150 different groups, this article analyses the dynamics of group lending mechanism (group formation, peer monitoring, pressure and support). The article widens the current narrow literature on group leaders by providing a detailed empirical account of the activities of group leaders in a microfinance intervention. The findings showed that because group leaders are primarily held liable for loan delinquency of group members, they are more highly motivated than other members to monitor and pressure members. The results also suggest that while group leaders were found to perform vital roles, some of these group leaders abused their positions in ways that undermine group cohesion and microfinance sustainability. Lastly, the article introduces the “multiple card phenomenon” in group-based microfinance intervention.
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Hes, Tomáš, Haiyan Sulaiman, Guillermo Bali Chávez, Samuel Mintah, and Ali Salman. "Comparison of four microfinance markets from the point of view of the effectuation theory, complemented by proposed musketeer principle illustrating forces within village banks." Management & Marketing 12, no. 1 (March 28, 2017): 37–48. http://dx.doi.org/10.1515/mmcks-2017-0003.
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Abstract Microfinance services are essential tools of formalization of shadow economics, leveraging immature entrepreneurship with external capital. Given the importance of shadow economics for the social balance of developing countries, the importance of an answer to a question of how microfinance entities come into existence, is rather essential. While decision-taking process leading to entrepreneurship were explained by the effectuation theory developed in the 90’, these explanations were not concerned with the logics of creation of microenterprises in neither developing countries nor microfinance village banks. While the abovementioned theories explain the nascence of companies in environment of developed markets, importance of a focus on emerging markets related to large share of human society of microfinance clientele is obvious. The study provides a development streak to the effectuation Theory, adding the musketeer principle to the five effectuation principles proposed by Sarasvathy. Furthermore, the hitherto not considered relationship between social capital and effectuation related concepts is another proposal of the paper focusing on description of the nature of microfinance clientele from the point of view of effectuation theory and social capital drawing a comparison of microfinance markets in four countries, Turkey, Sierra Leone, Indonesia and Afghanistan.
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Srnec, K., J. Svitaková, M. Výborná, and P. Burian. "Microfinance as a suitable instrument of European and Czech development cooperation." Agricultural Economics (Zemědělská ekonomika) 57, No. 11 (December 2, 2011): 529–33. http://dx.doi.org/10.17221/52/2011-agricecon.
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European countries use microfinance as an instrument of development cooperation in three separate forms, which differ in the financial flow. In the first type, the government transfers grant money to their non-government organizations (NGOs), which then distribute the funds directly to the local microfinance institutions (MFIs) (eg. Finland). In the second form, the funds are sent through to the branch-offices of the NGOs located in the developed country to developing countries (eg. Norway, Sweden). The third type allows for a direct relationship between a donor country development co-operation agency and a local microfinance institution in a developing country without intermediation of the developed country NGOs (eg. Great Britain, Germany). The Czech Republic currently does not support microfinance by the direct/indirect transfer of funds, but it promotes the awareness of the Czech NGOs and the public of microfinance as a tool for the economic development.
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Marconatto, Diego A. B., Luciano Barin-Cruz, and Eugenio Pedrozo. "Lending Groups and Different Social Capitals in Developed and Developing Countries." Revista de Administração Contemporânea 20, no. 6 (December 2016): 651–72. http://dx.doi.org/10.1590/1982-7849rac2016150050.
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Abstract Lending groups (LGs) and social capital are two central elements to the many microfinance solutions operating around the world. However, LG effectiveness in reducing transaction costs and lending risks for microfinance institutions (MFIs) is mediated by institutional environments. Starting from this assumption, we discuss the existent interactions between the institutional environments of developed (Anglo-Saxon and communitarian) and developing countries with different stocks of social capital (individual, network and institutional) and the influences of this interaction on LG effectiveness. In order to do so, we applied the institutional perspective of O. Williamson to build a theoretical framework to examine the interaction of all these conditions, allowing for analysis of their main relations within the microfinance context. Based on this framework, we propose on the one hand that in developing and Anglo-Saxon developed nations, stocks of both individual and network social capital are the most important for an LG's effectiveness. However, in Anglo-Saxon countries, these two stocks of social capital are complemented by formal contracting devices. In communitarian developed countries, on the other hand, the stocks of institutional social capital have a stronger positive impact on LG dynamics.
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Aninze, Festus, Hatem El-Gohary, and Javed Hussain. "The Role of Microfinance to Empower Women." International Journal of Customer Relationship Marketing and Management 9, no. 1 (January 2018): 54–78. http://dx.doi.org/10.4018/ijcrmm.2018010104.
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This article reviews, discusses and provides a critical analysis relating to the role of microfinance on issues linking to poverty, gender equality, and women empowerment with particular emphasis on developing economies. In addition, this article provides an overview of the opportunities and criticisms of microfinance which examines the contemporary issues on poverty reduction, entrepreneurial development and the family wellbeing. The article adds to the limited research examining the role of microfinance to empower women in developing countries.
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Bortolussi, R., N. MacDonald, C. Larson, J. Brenner, and J. Kabakyenga. "“Micro-Research” for Developing Countries: Borrowing From the Microfinance Experience." Paediatrics & Child Health 15, suppl_A (May 1, 2010): 56A. http://dx.doi.org/10.1093/pch/15.suppl_a.56a.
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Donou-Adonsou, Ficawoyi, and Kevin Sylwester. "Growth effect of banks and microfinance: Evidence from developing countries." Quarterly Review of Economics and Finance 64 (May 2017): 44–56. http://dx.doi.org/10.1016/j.qref.2016.11.001.
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Okello Candiya Bongomin, George, Joseph Mpeera Ntayi, and Charles Akol Malinga. "Analyzing the relationship between financial literacy and financial inclusion by microfinance banks in developing countries: social network theoretical approach." International Journal of Sociology and Social Policy 40, no. 11/12 (June 24, 2020): 1257–77. http://dx.doi.org/10.1108/ijssp-12-2019-0262.
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PurposeThe main purpose of this study is to establish the mediating effect of social network in the relationship between financial literacy and financial inclusion of the poor by microfinance banks in developing countries.Design/methodology/approachThe study adopted a cross-sectional research design and data were collected from the poor who resides in rural Uganda. Structural equation modelling (SEM) through analysis of moment structures (AMOS) was used to analyze the data. Bootstrap approach with 5,000 samples was run to establish the mediating effect of social network in the relationship between financial literacy and financial inclusion of the poor by microfinance banks in developing countries.FindingsThe results showed that social network significantly and positively mediate the relationship between financial literacy and financial inclusion of the poor by microfinance banks in developing countries. In addition, financial literacy also has a direct significant and positive effect on financial inclusion. Overall, the findings suggest that the presence of social network fully mediate the effect of financial literacy on financial inclusion of the poor by microfinance banks in developing countries.Research limitations/implicationsThis study adopted a cross-sectional research design and data were collected using a semi-structured questionnaire. Future studies could adopt longitudinal research design to establish the dynamic characteristics of the samples under study over time. Besides, this study collected data from only poor households who were clients of microfinance banks located in rural Uganda. It ignored the other section of the population who were not the poor. Therefore, future studies could use the other section of the population who are clients of commercial banks.Practical implicationsThe advocates of financial literacy and managers of microfinance banks in developing countries should ensure using existing local structures such as community and village associations to conduct financial literacy training. The village associations help in mobilizing members who are close-knit based on the existing societal ties that can be used as a channel for disseminating vital financial literacy information. Indeed, financial literacy workshops, seminars, and business clinics can be easily conducted to individuals who are members of the village associations.Originality/valueThis paper integrates social network theory in the relationship between financial literacy and financial inclusion of the poor by microfinance banks in developing countries. Social network acts as a conduit through which financial knowledge and skills flow to increase the scope of financial inclusion of the poor in developing countries.
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Salem Al-Harethi, Abobakr Ramadhan. "The Role Of Islamic Banks In Yemen In Supporting Microfinance Institutions." IKONOMIKA 3, no. 2 (January 30, 2019): 121–26. http://dx.doi.org/10.24042/febi.v3i2.3515.
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Islamic banks become the best solution to the crisis of the global financial system at present.in addition, it become also a real player in dealing with economic crises and the financial complexities of the traditional banking system prevailing in the world today. moreover, countries and governments in both developed and developing countries have become increasingly interested in the issue of microfinance because of their close association with the development in various countries and may be interested in supporting countries and governments for microfinance by enacting the necessary laws and legislation. And the establishment of institutions and bodies specialized in financing and support these microfinance in addition to the microfinance in many developed countries have become a specialty taught in universities and specialized institutes. Scientific seminars and conferences are held in order to support and develop it so that it achieves the objectives set for it and thus meets the aspirations of society in development. This study focus on the role of Islamic banks that can play an active and influential role in generating wealth and reducing poverty through financing for Microfinance institutions where the study showed the social role of the nature of contracts in Islamic banks through which Islamic banks can be the best in Microfinance. Keywords : Islamic banks, Microfinance institutions, Yemen
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Rashid, Fwamba, Matete John, Nasimiyu Consolatta, and Sungwacha Stephen. "Impact of microfinance institutions on economic empowerment of women entrepreneurs in developing countries." International Journal of Management Science and Business Administration 1, no. 10 (2015): 45–55. http://dx.doi.org/10.18775/ijmsba.1849-5664-5419.2014.110.1004.
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This study mirrored out the effects of Microfinance on economic empowerment of Women Entrepreneurs in developing economies. Descriptive research design was used to assess the extent to which Women economic empowerment co-relates with Microfinance Institutions services. The target population was women entrepreneurs in Micro Finance Institutions (MFIs) within Kakamega C.B.D. Simple random probability sampling was applied to select ten (10) MFIs where four (4) active women entrepreneurs from each MFI was taken, adding to forty (40) respondents. Both primary and secondary data was collected through questionnaires and semi-structured interviews. Data collected was presented by descriptive statistics like pie charts and graphs. From the analysis, the results showed that microfinance services act as a key fulcrum to women entrepreneurs’ economic empowerment. The results were re-affirmed by a linear regression analysis (SPSS version 22). The findings will be used to make policy proposals that will see MFIs meet the economic empowerment needs of women Entrepreneurs to make developing countries progress as Kenya prepares to achieve vision 2030.
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Sharma, Puspa Raj. "Microfinance: A Powerful Tool for Social Transformation, Its Challenges, and Principles." Journal of Nepalese Business Studies 1, no. 1 (August 12, 2006): 69–74. http://dx.doi.org/10.3126/jnbs.v1i1.40.
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This paper attempts to explore the role and importance of microfinance in reducing poverty by generating the income of the poor. Microfinance has been emphasized for poverty reduction in developing countries through executing dual activities such as collection of domestic saving and investment of small loan. In this connection, this paper suggests microfinance practitioners and MFI to follow certain principles for making the microfinance services more sustainable in the long run and sheds light on the problems and challenges of microfinance.
Journal of Nepalese Business Studies Vol.1(1) 2004 pp.69-74
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Alhassan, Yahaya, and Uzoechi Nwagbara. "Institutions, Corruption and Microfinance Viability in Developing Countries: the Case of Ghana and Nigeria." Economic Insights – Trends and Challenges 2021, no. 2 (2021): 61–70. http://dx.doi.org/10.51865/eitc.2021.02.06.
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This article focuses on the role corrupt institutions (microfinance institutions) play in microfinance not being accessible for business development in Africa. It specifically sheds light on the contexts of Nigeria and Ghana to tease out the challenges and opportunities for small businesses consequent upon a culture of corruption in these countries and associated challenges for small business owners and entrepreneurs as well as microbusiness development. As well-known, in many developing countries with a high level of corruption, there is potentially a high incidence of institutional void, which presents setback and challenges for businesses to thrive. Microbusiness development relies largely on effective institutions to develop, and in situations where institutions are corrupt, these challenges are rather redoubled thus posing a threat to entrepreneurship development. Therefore, these contexts enable us to understand and interrogate the challenges facing microbusiness development, where corrupt microfinance institutions exist, as well as business opportunities if these corrupt institutions were not present. Thus this paper argues that for businesses to thrive enabling and effective institutional mechanisms are crucial, which will facilitate opportunities for microbusiness development.
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Mahmoud Ali, Israa Ali, and Hebatallah Ghoneim. "The effect of microfinance on income inequality: perspective of developing countries." Journal of Economics and Management 35 (2019): 40–62. http://dx.doi.org/10.22367/jem.2019.35.03.
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Butaboev, Davron. "REGULATORY PROCEDURES OF MICROCREDIT ORGANIZATIONS OF THE EUROPEAN COUNTRIES." INNOVATIONS IN ECONOMY 4, no. 7 (July 30, 2021): 66–71. http://dx.doi.org/10.26739/2181-9491-2021-7-8.
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The article analyzes the practice of organizing and developing the activities of microcredit organizations, the practice of microcrediting small businesses, the formation of the legal frameworkfor the activities of microcredit organizations in the practice of the European Union.Keywords: microcredit, microfinance, microloan, pawnshop, credit union, credit bureau
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Banerjee, Subhabrata Bobby, and Laurel Jackson. "Microfinance and the business of poverty reduction: Critical perspectives from rural Bangladesh." Human Relations 70, no. 1 (May 22, 2016): 63–91. http://dx.doi.org/10.1177/0018726716640865.
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In this article we provide a critical analysis of the role of market-based approaches to poverty reduction in developing countries. In particular, we analyse the role of microfinance in poverty alleviation by conducting an ethnographic study of three villages in Bangladesh. Microfinance has become an increasingly popular approach that aims to alleviate poverty by providing the poor new opportunities for entrepreneurship. It also aims to promote empowerment (especially among women) while enhancing social capital in poor communities. Our findings, however, reflect a different picture. We found microfinance led to increasing levels of indebtedness among already impoverished communities and exacerbated economic, social and environmental vulnerabilities. Our findings contribute to the emerging literature on the role of social capital in developing entrepreneurial capabilities in poor communities by highlighting processes whereby social capital can be undermined by market-based measures like microfinance.
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Kimani, Hannah Kimani. "The Role of Access to Finances and Poverty Reduction in Developing Countries. A Critical Literature Review." International Journal of Poverty, Investment and Development 2, no. 2 (November 23, 2022): 1–9. http://dx.doi.org/10.47941/ijpid.1136.
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Purpose: Financial institutions improves the well-being of participants through job creation, increasing income and building assets (wealth). It makes poor people to be homeowners through schemes such as housing microfinance. The overall objective of this study was to examine influence of access to finances and poverty reduction in developing countries. A critical literature review
Methodology: The paper used a desk study review methodology where relevant empirical literature was reviewed to identify main themes and to extract knowledge gaps.
Findings: This study concluded that access to home improvement finances led to improvement in living conditions from living in shanties to permanent dwellings hence better living conditions and reduction in poverty. Access to school fees loans led to higher enrolment rates in schools improving literacy levels in developing countries and hence reducing poverty. Lower interest rates led to more access to microfinance loans and in the long run a reduction in poverty, availability of collaterals meant ability to pay and credit worthiness of respondent’s hence easier access to microfinance loans which leads to poverty reduction in the long run. Favourable credit policy led to increased access to microfinance loans and vice versa.
Unique Contribution to Theory, Policy and Practice: This study recommended that financial institutions that are able to give out loans to help serve the poor, should arrange mechanisms to improve technical and business skills of the poorest through training and loan utilization. This will enhance their business skills to use credit and establish market channels for their products.
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Hossain, Shahadat, and Rubaiyet Hasan Khan. "Securitization: An Alternative Funding Mechanism for the Microfinance Institutions." Journal of International Business, Economics and Entrepreneurship 3, no. 2 (December 31, 2018): 1. http://dx.doi.org/10.24191/jibe.v3i2.14427.
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Despite microfinance has been widely appreciated as an informal financial mechanism to provide financial services to the poor people in developing countries, this sector is still lacking behind in fulfilling the demand gap due to the dearth of adequate funds. Securitization opens a new horizon that overcomes the funding barriers of microfinance through which the top tier Microfinance Institutions (MFIs) can accumulate funds to enlarge their portfolio without issuing any debt or equity. This paper is a desk study that synthesizes how securitization can be used in the funding of the MFI portfolio and what are the benefits and risks associated with securitization of microfinance portfolio. As a case study, we use the two examples of cross-border securitizations in the microfinance industry to diagnose the role of securitization in microfinance.
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Baboucarr, Baboucarr. "Islamic micro-finance review: A special topic in finance." Bussecon Review of Finance & Banking (2687-2501) 2, no. 1 (February 24, 2020): 19–22. http://dx.doi.org/10.36096/brfb.v2i1.168.
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The purpose of this paper is to provide a review of Islamic Microfinance and its application as a tool for poverty reduction, especially in developing countries. This system of financing serves as an alternative to the interest-based loans from conventional banks as well as conventional microfinance Institutions to the poor yet Islamic conscious millions of Muslims. This paper takes a descriptive approach and relied upon the available literature on Islamic Microfinance to highlight the different approaches used in different parts of the world. The conclusion from the review showed Islamic microfinance as doing well in poverty reduction, women empowerment, and being efficient in its operations.
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Bongomin, George Okello Candiya, Atsede Woldie, and Aziz Wakibi. "Microfinance accessibility, social cohesion and survival of women MSMEs in post-war communities in sub-Saharan Africa: Lessons from Northern Uganda." Journal of Small Business and Enterprise Development 27, no. 5 (June 30, 2020): 749–74. http://dx.doi.org/10.1108/jsbed-12-2018-0383.
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PurposeGlobally, women have been recognized as key contributors toward livelihood and poverty eradication, especially in developing countries in sub-Saharan Africa. This is due to their great involvement and participation in micro small and medium enterprises (MSMEs) that create employment and ultimately economic growth and development. Thus, the main purpose of this study is to establish the mediating role of social cohesion in the relationship between microfinance accessibility and survival of women MSMEs in post-war communities in sub-Saharan Africa, especially in Northern Uganda where physical collateral were destroyed by war.Design/methodology/approachThe data for this study were collected using a pre-tested semi-structured questionnaire from 395 women MSMEs who are clients of microfinance institutions in post-war communities in Northern Uganda, which suffered from the 20 years' Lord Resistance Army (LRA) insurgency. The Analysis of Moment Structures (AMOS) software was used to analyze the data and the measurement and structural equation models were constructed to test for the mediating role of social cohesion in the relationship between microfinance accessibility and survival of women MSMEs in post-war communities.FindingsThe results revealed that social cohesion significantly and positively mediate the relationship between microfinance accessibility and survival of women MSMEs in post-war communities in Northern Uganda. The results suggest that the presence of social cohesion as a social collateral promotes microfinance accessibility by 14.6% to boost survival of women MSMEs in post-war communities where physical collateral were destroyed by war amidst lack of property rights among women. Similarly, the results indicated that social cohesion has a significant influence on survival of women MSMEs in post-war communities in Northern Uganda. Moreover, when combined together, the effect of microfinance accessibility and social cohesion exhibit greater contribution towards survival of women MSMEs in post-war communities in Northern Uganda. Indeed, social cohesion provides the social safety net (social protection) through which women can access business loans from microfinance institutions for survival and growth of their businesses.Research limitations/implicationsThis study concentrated mainly on women MSMEs located in post-war communities in developing countries in sub-Saharan Africa with a specific focus on Northern Uganda. Women MSMEs located in other regions in Uganda were not sampled in this study. Besides, the study focused only on the microfinance industry as a major source of business finance. It ignored the other financial institutions like commercial banks that equally provide access to financial services to micro-entrepreneurs.Practical implicationsThe governments in developing countries, especially in sub-Saharan Africa where there have been wars should waive-off the registration and licensing fees for grass-root associations because such social associations may act as social protection tools through which women can borrow from financial institutions like the microfinance institutions. The social groups can provide social collateral to women to replace physical collateral required by microfinance institutions in lending. Similarly, the governments, development agencies, and advocates of post-war reconstruction programs in developing countries where there have been wars, especially in sub-Saharan Africa should initiate the provision of group business loans through the existing social women associations. This may offer social protection in terms of social collateral in the absence of physical collateral required by the microfinance institutions in lending. This may be achieved through partnership with the existing microfinance institutions operating in rural areas in post-war communities in developing countries. Additionally, advocates of post-war recovery programs should work with the existing microfinance institutions to design financial products that suit the economic conditions and situations of the women MSMEs in post-war communities. The financial products should meet the business needs of the women MSMEs taking into consideration their ability to fulfil the terms and conditions of use.Originality/valueThis study revisits the role of microfinance accessibility in stimulating survival of women MSMEs as an engine for economic growth in the presence of social cohesion, especially in post-war communities in sub-Saharan Africa where physical collateral were destroyed by war. It reveals the significant role of social cohesion as a social protection tool and safety net, which contributes to economic outcomes in the absence of physical collateral and property rights among women MSMEs borrowers, especially in post-war communities.
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Maishanu, Umar Aliyu, and A. K. Siti-Nabiha. "EXPLORING THE ADVANCEMENT AND ROLES OF ISLAMIC MICROFINANCE INSTITUTIONS IN MICROENTERPRISE DEVELOPMENT IN NIGERIA." International Journal of Industrial Management 7 (September 1, 2020): 52–59. http://dx.doi.org/10.15282/ijim.7.0.2020.5754.
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This paper discusses the advancement and roles of microfinance institutions, specifically Islamic microfinance institutions in microenterprise development in Nigeria. Microfinance institutions play a key role in financial inclusion and microenterprise development, especially in developing countries. The key aim of microfinance initiatives is to eradicate poverty by providing access to a wide range of financial products and services for those who are financially excluded. The emergence of microfinance in Nigeria appears to be promising, as these institutions support Nigerians of average or poor means by improving their living conditions. However, the nature and conditions of the schemes do not satisfy the sensitivities and requirements of a substantial number of people including poor Muslims who need funding but are unable to take advantage of conventional microfinance services, as loan conditions are seen as being contradictory to Islamic teachings. Islamic microfinance, therefore, can alleviate poverty through the development of microenterprises.
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Subramaniam, Yogeeswari, Tajul Ariffin Masron, Mastura A. Wahab, and Md Aslam Mia. "The impact of microfinance on poverty and income inequality in developing countries." Asian-Pacific Economic Literature 35, no. 1 (April 12, 2021): 36–48. http://dx.doi.org/10.1111/apel.12326.
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Nugroho, Agus Eko. "Microfinance Commercialization, Challenges and Issues in Developing Countries: A Critical Literature Review." Economics and Finance in Indonesia 54, no. 2 (March 21, 2015): 173. http://dx.doi.org/10.7454/efi.v54i2.96.
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Assadi, Djamchid, and Meredith Hudson. "Marketing-Mix of Online Social Lending Websites." Journal of Electronic Commerce in Organizations 8, no. 3 (July 2010): 15–25. http://dx.doi.org/10.4018/jeco.2010070102.
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With the rise of microfinance in developing countries and its evolution to a business model in developed nations, microfinance has fully transitioned to the internet, taking the distinctive form of social lending. However, the marketing trends of emerging peer-to-peer micro-lending websites have been largely unexplored during its rise to recognition due to most studies focusing on financial, economic, political and humanitarian issues in context to microfinance. However, based on a sample of eight popular social lending websites, this paper uses cases to analyze the marketing elements of these sites to better understand how they function and to predict the future.
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Ullah, Inayat, and Madiha Khan. "Microfinance as a tool for developing resilience in vulnerable communities." Journal of Enterprising Communities: People and Places in the Global Economy 11, no. 2 (May 8, 2017): 237–57. http://dx.doi.org/10.1108/jec-06-2015-0033.
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Purpose The purpose of this paper is to review different microfinance products and services that can be offered to reduce the financial vulnerabilities of communities at risk. Following a detail literature review, the effectiveness of different forms of microfinance services in creating resilience in the affected communities was analysed and whether they can be applied to mitigate the risk of future disasters was assessed. In addition, the study was conducted to assess whether microcredit can help reduce direct risk exposure of the poor through income smoothing. Design/methodology/approach This study is based on a review of existing theories. Findings The notion that most vulnerable communities are financially weak is evident from studies. This study finds that microcredit can help reduce direct risk exposure of poor through income smoothing, while saving can help them recover from the losses of disasters. Our review also suggests that there is no specific model of microfinance services which can have a holistic impact on the financial capacity-building, particularly during the rehabilitation process. Research limitations/implications There are different categories of microfinance products with distinct characteristics and associated benefits to the communities. Some of the major microfinance products as identified in this study are, saving products, credit products and insurance products. These products have multidimensional benefits, as there are many approaches adopted by microfinance institutions (MFIs) and clients regarding the use of these products. However this study focuses on the use of these products towards resilience development in the community. Other applications of these products still need to be explored. Practical implications There is a need for a comprehensive financial tool that can be effectively applied to expedite the process of rehabilitation and reduce the financial impact of disasters on the community, particularly the poor. Major issues in the context of disasters faced by MFIs to design their products in the affected areas are also highlighted in the study. Social implications The study throws lights on different microfinancial tools such as microloans, microcredits and cash for work, etc. offered by banks and other organizations and highlights their role in the rehabilitation and reconstruction of those affected by disasters in different parts of the world. Originality/value This paper contributes to the discourse of microfinance and its social applications in developing countries. It provides original role of microfinance as a tool for creating community resilience to the impacts of disasters.
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Okello Candiya Bongomin, George, and John C. Munene. "Procedural and declarative cognitions." International Journal of Ethics and Systems 35, no. 4 (November 11, 2019): 691–708. http://dx.doi.org/10.1108/ijoes-01-2019-0026.
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Purpose Premised on the argument that procedural and declarative cognitions help individuals to memorize, store and recall information to make informed decisions and choices in daily life, the purpose of this paper is to analyze the auxiliary psychosomatic roles of procedural and declarative cognitions in promoting financial literacy among clients of microfinance banks in developing countries. Design/methodology/approach The study adopted a cross-sectional research design and a semi-structured questionnaire was used to collect responses from 400 poor households’ heads located in rural Uganda. Analysis of moment structures and structural equation modeling were used to test for the auxiliary psychosomatic roles of procedural and declarative cognitions in promoting financial literacy among the poor who are clients of promotion of rural initiatives development enterprises (PRIDE) microfinance bank in rural Uganda. Findings The results revealed that both procedural and declarative cognitions significantly and positively boost financial literacy among the poor who are clients of PRIDE microfinance bank in rural Uganda. Jointly, both types of cognitions explain 30 per cent of the variation in financial literacy among the poor who are clients of PRIDE microfinance bank. Accordingly, the results correspond to arguments by psychologists that the human mental models help individuals to process, encode, store and retrieve information at an appropriate time such as in articulating complex financial information. Research limitations/implications The study focused majorly on cross-sectional research design. Thus, future studies may use longitudinal research design to explore the ability of the poor to memorize and retrieve financial information over time. Additionally, the study used only quantitative data collected using a semi-structured questionnaire. Further studies may use qualitative data collected by means of interviews. Besides, this study solely used poor households living in rural Uganda as the main source of data. Hence, future studies involving data from other section of the population may be necessary. Practical implications The results from this study underpins the auxiliary psychosomatic roles of procedural and declarative cognitions in promoting financial literacy among clients of microfinance banks in developing countries. Indeed, the human mental models that revolve around cognition as individuals grow are critical in helping them make informed financial decisions when they are faced with difficult financial situations. Therefore, microfinance banks and financial literacy programs in developing countries should consider the roles of procedural and declarative cognitions while designing financial literacy modules. This is because they determine how individuals receive, encode, store and retrieve financial information in order to make informed and better financial decisions before consuming financial products offered by the microfinance banks. Originality/value At present, there is scanty extant literature and theory that explains the auxiliary psychosomatic roles of procedural and declarative cognitions in promoting financial literacy, especially in developing countries. The current study sheds more light on the deterministic roles of procedural and declarative cognitions in boosting financial literacy.
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Dushime, Joseph, Immaculate Nakalembe, Yar Makuei, Albert Kwitonda, Samuel Hakizimana, and Stephen Muathe. "Microfinance Institutions as a Vehicle for Poverty Eradication in Developing Countries: Evidence from the East African Community Member States." European Scientific Journal, ESJ 18, no. 22 (July 31, 2022): 207. http://dx.doi.org/10.19044/esj.2022.v18n22p207.
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This paper focuses on examining the link that exists between microfinance institutions (MFIs) and poverty eradication efforts in developing countries, specifically focusing on the East African member states of Burundi, Democratic Republic of Congo (DRC), Kenya, Rwanda, South Sudan, Tanzania, and Uganda. The study was driven by the varying interpretations, debates, and opposing opinions in literature on the effects of MFIs on poverty eradication in developing economies, particularly in the East African Community (EAC). The study used a depth literature search using secondary data on the role of MFIs in poverty eradication in the EAC context. The results pointed out that despite the challenges such as high transaction rates, limited funding and others, microfinance credit has played a significant role in poverty eradication among poor/low-income families in the EAC Member States. Therefore, the study recommends that governments of the EAC Member States should increase government support, and conducive working environments should be provided to ensure microfinance institutions reach as many less privileged individuals as possible so as to raise their economic status.
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Baskaran, Angathevar, Thiri Dong, and Sonia Kumari Selvarajan. "Microfinance and Women’s Empowerment in Myanmar." Jurnal Institutions and Economies 14, no. 2 (April 1, 2022): 59–90. http://dx.doi.org/10.22452/ijie.vol14no2.3.
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Like in many other developing countries, microfinance programmes in Myanmar have become an avenue to reduce poverty. This research examines whether microfinance in Myanmar has empowered female clients compared to non-microfinance clients, in terms of: (i) general decision-making (children’s education, family planning, children’s marriage, health care); and (ii) financial decision-making (income utilisation, loan usage, savings, investment). Primary data was collected using a questionnaire survey to achieve the research objectives. The sample of the survey consists of two groups of women living in the Ayeyarwady region, Myanmar: (i) Beneficiaries of microfinance programmes, and (ii) non-beneficiaries of any microfinance institutions. Female clients either started a new business or expanded/diversified an existing business using microfinance, which helped to increase income and savings. Overall, 89.8% of microfinance clients have gained significant empowerment (in making general and financial decisions combined). The discriminant analysis based on four indicators - children’s education, children’s marriage, savings, and investment - shows that the decision-making power of microfinance clients has improved compared to non-clients. The government should actively promote a microfinance ecosystem through robust microfinance institutional frameworks including, microfinance institutions, intermediaries, and local government agencies. Financial literacy awareness campaigns should be organised frequently to promote wider women’s participation in microfinance programmes.
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Koob, Michael. "Mikrofinanzierungen." Der Betriebswirt: Volume 51, Issue 3 51, no. 3 (September 30, 2010): 17–22. http://dx.doi.org/10.3790/dbw.51.3.17.
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Mikrofinanz hat sich zu einem entwicklungspolitischen Schlagwort ausgebildet. In der Entwicklungszusammenarbeit gilt die Vergabe von Kleinstkrediten seit langem als Erfolgsmodell. Was steckt hinter diesem durch den Friedensnobelpreisträger Muhammad Yunus bekannt gewordenen Instrument? Wie sieht die Praxis in den Entwicklungsländern aus? Gibt es für Mikrofinanzierungen auch einen Markt in den entwickelten Ländern. Microfinance has raised high expectations regarding poverty alleviation in the developing countries. Lack of empirical evidence has not, however, diminished the enthusiasm of the proponents of microfinance. The perception that microfinance plays an important role in poverty alleviation has attracted substantial assistance from international donors and local governments. What are the instruments and tools for implementing microfinance successfully in a country? What are the challenges? We have chosen Uganda in East Africa as a good example to see the lessons learnt in microfinance. Even in the industrialized world microfinance plays a more and more important role in the financial sector for customers and institutional investors. Keywords: mikrofinanzierungen, microfinances
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Zainuddin, Mohammad, and Ida Md Yasin. "Resurgence of an Ancient Idea? A Study on the History of Microfinance." FIIB Business Review 9, no. 2 (May 13, 2020): 78–84. http://dx.doi.org/10.1177/2319714520925933.
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Microfinance revolution, as it was frequently called, did not happen overnight. Microfinance has a long history of evolution, from a simple idea to a global movement, through which it came into the present shape. But much of its history is yet to be written systematically. In fact, there is no historical research so far from the perspective of microfinance. Little is thus known about the early history of some of the oldest forms of lending to the poor. The current study offers a historical look at microfinance and aims at documenting the evolution of modern microfinance institutions. The object of the research is to recognize the historical depth of microfinance and give a picture of how this idea emerged and developed overtime. The study reveals that moneylending to the poor was always in existence in various forms in different periods of time in both developing and developed countries. It has a long history, particularly in Asia but also in Africa and Europe.
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Farrer, Rebecca. "Exploring the Human Rights Implications of Microfinance Initiatives." International Journal of Legal Information 36, no. 3 (2008): 447–89. http://dx.doi.org/10.1017/s0731126500003255.
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This Article explores Microfinance and microcredit (“MFI”) programs from several perspectives, with particular emphasis on human rights issues. These programs involve making small loans to people who would otherwise be unable to borrow money to facilitate them starting their own businesses: frequently, the programs focus on women borrowers in developing countries. The emphasis of MFI programs on women in developing countries makes it important to consider these programs in terms of both women's and indigenous rights, while MFI as an approach to poverty merits a discussion of economic rights. Part I of the article will explore the concept and scope of current MFI programs, describing key components of these programs and assessing comments from both fans and critics. The Grameen Bank, which has been studied extensively and has acted as a model for several other programs, will be examined in detail. Part II of this Article considers MFI in the context of human rights considerations, including economic, indigenous, and women's rights. One particular aspect of Grameen's program, namely the use of Sixteen Decisions, is also critiqued, applying organizational behavior theory. Part III will compare MFI with other approaches to poverty, inclu property rights initiatives, women's cooperatives and social enterprise approaches.
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CAMPBELL, NOEL D., and TAMMY M. ROGERS. "MICROFINANCE INSTITUTIONS: A PROFITABLE INVESTMENT ALTERNATIVE?" Journal of Developmental Entrepreneurship 17, no. 04 (December 2012): 1250024. http://dx.doi.org/10.1142/s1084946712500240.
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This paper examines the determinants of return on equity for microfinance institutions (MFI), an important source of funds for entrepreneurs in developing countries. Recent research indicates that MFIs need to become financially sustainable without relying on external funding. To meet this objective, MFIs have begun to look to the capital markets as a source of funds. Our findings indicate that investors in MFIs can look at measures similar to those used by traditional financial institutions, like commercial banks, such as operating expense and portfolio yield measures to measure possible performance of a MFI. MFIs that have a larger percentage of women borrowers fare better. Additionally, we find that country specific macroeconomic conditions affect MFI return.
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Zeller, Manfred. "A comparative review of major types of rural microfinance institutions in developing countries." Agricultural Finance Review 66, no. 2 (November 2006): 195–213. http://dx.doi.org/10.1108/00214660680001187.
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Bel hadj Miled, Kamel, and Jalel-Eddine Ben Rejeb. "Can Microfinance Help to Reduce Poverty? A Review of Evidence for Developing Countries." Journal of the Knowledge Economy 9, no. 2 (January 25, 2016): 613–35. http://dx.doi.org/10.1007/s13132-015-0348-2.
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Dorfleitner, Gregor, Davide Forcella, and Quynh Anh Nguyen. "Microfinance and Green Energy Lending: First Worldwide Evidence." Credit and Capital Markets – Kredit und Kapital: Volume 53, Issue 4 53, no. 4 (October 1, 2020): 427–60. http://dx.doi.org/10.3790/ccm.53.4.427.
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The increasing requirement for action on climate change in developing countries has led to the inclusion of environmental aspects in microfinance objectives, in addition to social and financial performance, and hence to the appearance of green microfinance. To date, financing for modern energy service has proven to be an attractive option to offset adverse climate change related effects for the poor. This article sheds some light on factors predicting clean energy finance involvement of MFIs. By using a worldwide survey among microfinance institutions on rural lending and IT solutions implemented by YAPU Solutions, this study investigates how institutional characteristics and economic growth relate to green energy micro-credit. The findings provide evidence of a significantly positive relationship between the maturity and business sustainability of an MFI and the likelihood of offering green energy loans. Moreover, MFIs managed by female managers and located in wealthy countries are less willing to commence the finance of green energy.
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Rana, Kanika, and Brinda Viswanathan. "Patterns of Access to Microfinance Loans in India." Review of Development and Change 24, no. 2 (December 2019): 259–79. http://dx.doi.org/10.1177/0972266119886677.
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Due to various supply and demand factors, households in developing countries may borrow from a single source or combination of sources—formal, informal and microfinance institutions (MFI). Who is accessing what types of loan sources? This study uses Indian Human Development Survey (2011–2012) to analyse, for the first time, households accessing microfinance loans either alone (8%) or in combination with other sources (13%). We find that the more developed southern states have the highest MFI-linked borrowers (39%). Despite the low overall share of MFI borrowing, microfinance supports inclusiveness with higher presence among the economically disadvantaged and socially underprivileged, such as female-headed, casual labour, Other Backward Classes and dalit households. Expectedly, the effects of social networking are more pronounced among MFI-linked borrowers.
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Hawariyuni, Weni, and Salina Hj. Kassim. "Proposing an Integrated Islamic Microfinance Model in Alleviating Poverty and Improving the Performance of Microenterprises in Indonesia." Journal of Accounting Research, Organization and Economics 2, no. 2 (August 31, 2019): 135–54. http://dx.doi.org/10.24815/jaroe.v2i2.14630.
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Objective – This study proposes an integrated Islamic microfinance model in alleviating poverty and improving the performance of microenterprises based on a case study of Indonesia, by focusing specifically on BRI Microbanking. Design/methodology – This study adopts the exploratory study to construct the integrated Islamic microfinance with the purpose to alleviate poverty and enhance the business performance of enterprises. Results – As Islamic microfinance is known widely due to the high demand from Muslim countries. Since, it plays a crucial role effectively in alleviating poverty and developing the business performance on enterprises, particularly on microenterprises. Presently, many scholars attempted to build a successful Islamic microfinance model by using Islamic financing instruments such as mudarabah, musyarakah, and murabahah. This study attempts to build an integrated Islamic microfinance model by using BRI Syariah Micro as a case study. It is expected that this integrated Islamic microfinance model can enrich existing models in terms of social and economic aspects. Originality/Value – This research concentrates on proposing an integrated Islamic microfinance model based on the case study of BRI Syariah Microbanking. There seems to be a gap in the literature on the actual implementation of integrated Islamic microfinance in the world. The study highlights major factors to be emphasized to ensure the effectiveness of proposing an integrated Islamic microfinance model for BRI Syariah micro banking to alleviate poverty and to improve the performance of microenterprises.
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Gan, Christopher, and Wittawat Hemtanon. "Sustainability of Microfinance Institutions in Thailand." Asian Journal of Agriculture and Development 19, no. 1 (June 28, 2022): 77–90. http://dx.doi.org/10.37801/ajad2022.19.1.5.
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Microfinance programs play a vital role in poverty alleviation in developing countries; however, most microfinance institutions (MFIs) face the challenge of maintaining financial sustainability. While several studies have investigated factors affecting MFI financial sustainability, only a few focus on MFIs in Thailand. This paper uses the random effect model to study the determinants of Thai MFIs’ financial sustainability. Results show that sustainability is affected by the efficiency of Thai MFI staff members in managing borrowers and the MFIs’ ability to use their short-term assets to generate cash or revenue. Moreover, Thai MFIs do not benefit from economies of scale and do not reach the very poor households. This study recommends that MFIs should ensure that their social and financial goals are adequately balanced. It proposes that MFIs use a mixed approach: follow profit maximization principles and embrace technology to minimize operational costs.
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Chapman, David W., and Roger A. Boothroyd. "Evaluation dilemmas: Conducting evaluation studies in developing countries." Evaluation and Program Planning 11, no. 1 (January 1988): 37–42. http://dx.doi.org/10.1016/0149-7189(88)90031-6.
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Md Saad, Norma, and Azizah Anuar. "‘Cash Waqf’ and Islamic Microfinance: Untapped Economic Opportunities." ICR Journal 1, no. 2 (December 15, 2009): 337–54. http://dx.doi.org/10.52282/icr.v1i2.751.
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The success of microfinance programmes in alleviating poverty in many countries has spurred the development of faith-based microfinance institutions. Muslims have combined certain elements in Islamic finance and microfinance to create a new programme called ‘Islamic microfinance’ and use it as a tool to fight poverty in their community. Even though microfinance is proven successful in fighting poverty, current microfinance practised by commercial banks in Malaysia has several shortcomings. Current weaknesses include stringent credit evaluation and missing the real target group, i.e., the poor and the needy. Furthermore, the mode of financing is mostly personal loan using bay’ al-‘inah, whereby the use of the loan is to fulfil personal consumption instead of income-generating activities. Given these shortcomings, the article explores the possibility of using ‘cash waqf’ as a new source of funding for Islamic microfinance and proposes a new concept and application of Islamic microfinance so that it is truly in line with the Islamic spirit of microfinance. It is hoped that with this new concept and application of Islamic microfinance, the use of microfinance genuinely caters for the needs of the poor as well as generating socio-economic growth of the Muslim ummah.