Examining the Effect of Microcredit on Employment in Peninsular Malaysia

Abstract

This study employs a cross sectional design with stratified random sampling method to examine how participation in Amanah Ikhtiar Malaysia’s (AIM) microcredit program affects employment rate of hardcore poor clients household and community in Peninsular Malaysia. So far no known study has been conducted to measure the effect of AIM’s microcredit program on employment. Findings of this study show that participation in AIM’s microcredit program increases employment generating opportunities at household and community level. The policy may be reviewed and re-organized to increase the employment rate and income generating opportunities by providing appropriate training and diversified and flexible loan offers.