Impact Of Microfinance Research Articles

Impact of Microfinance in the Services of Rural Development with Specific Reference to Downtrodden People at Virudhachalam

The study titled on “Impact of Microfinance in the services of Rural development with specific reference to downtrodden people at Virudhachalam” clearly states that the Concept, Significance and Salient features of Microfinance in the services of Rural Development. It also explains how the Microcredit plays a vital role in the development of Rural folks especially for the development of Women. The main focus of the study is to understand how the Microcredit acts as a tool of poverty alleviation and empowerment. The research design used for the study is “Conceptual Theory” provides the structure for the whole study based on Experience and enquiries made from rural folks. Hence, the suggestions, recommendations are constructed which is considered to be the predominant part of the study.

An Impact Assessment of Microfinance: A Case Study of Socio-Economic Empowerment of SHG Members in Manipur (India)

PurposeMicrofinance holds a big promise to generate income and employment and alleviate poverty in developing countries. NGOMFIs have significant contribution in building capacity of SHGs and shaping them to grow for self sustainable. This paper attempts to assess the economic empowerment of SHGs, the social empowerment of SHGs and the overall socio-economic empowerment of SHGS due to microfinance intervention of NGO-MFIs in Manipur State which is in the North-Eastern corner of India. Design/methodology/approachA sample size of 120 SHG members of 60 SHGs from 20 NGOs is considered for the study. Socio-economic empowerment index before and after microfinance intervention is used for assessing the socio-economic empowerment of SHG members. Recall method is used for assessing the impact of microfinance as it is cost effective and less time consuming. However, cross verification is also done with records of SHG members maintained by NGO-MFIs and thereafter data is normalized to give near accurate result. Findings – It is found that after joining the microfinance programme, there is a significant improvement in overall economic empowerment index and the social empowerment index of the sampled SHG members. Further, findings also reveal that there is a significant improvement in overall Economic and Social Empowerment index of MFI’s clients after joining the microfinance programme. Research limitations/implications – The study is limited to only NGOs & SHGs who are involved in micro-finance activities. The study does not attempt to cover other organizations or voluntary organizations who are involved in social development activities. Since recall method is used, some SHG members cannot remember properly and have responded on assumptions and approximation. However, this limitation has been normalized by comparing records maintained by NGO-MFIs. Practical implications – This finding of the study will be beneficial to many NGO-MFIs to understand how their microfinance intervention helps poor women empower economically as well as socially. The techniques and tools used in this study are very simple and easy and very practicable for the NGO-MFIs who want to evaluate the socio-economic change of their beneficiaries because of their microfinance programme. Originality/value – Study is purely based on the primary data collected from the field survey as well as from records maintained by NGO-MFIs. The findings and feedback given to the sample NGO-MFIs are highly beneficial to them and they are surprised to know that microfinance programme have significant contribution in the improvement of socio-economic status of SHG members.

Impact of Microfinance Bank on Standard Of Living of Hairdresser in Oshodi-Isolo Local Government of Lagos State

The research study takes a look at the impact of Microfinance bank on standard of living of hairdressers in Oshodi-Isolo local government area (LGA) of Lagos State as a Poverty eradication strategy among the society. The objectives of the study examine how Microfinance bank in Oshodi-Isolo has impacted greatly on the business of hairdressers in the local Government and to also examine the impact of Microfinance on asset acquisition and savings of hairdressers in that LGA. A total of 120 hairdressers who registered with Oshodi-Isolo LGA were used as study sample. However, primary data of questionnaire analysis was adopted and Spearman's rank correlation coefficient analysis was used as the estimation techniques. More so, the hypotheses of the research were tested at 5% level of significance and the result revealed that there is a significant relationship between Microfinance bank efforts and standard of living of hairdressers in Oshodi- Isolo local Government area of Lagos state, and the implication of this is that due to the existence and help of Microfinance bank, Poverty has reduced a little bit among the hairdressers association in Oshodi Isolo LGA. In conclusion, the study recommend that Government at Local, State and Federal levels through the Central bank of Nigeria should ensure that Microfinance bank loans are easily obtainable and repayment should include a grace period with reasonable schedule instead of weekly payment period that is commonly found among the microfinance banks in Nigeria.

Micro enterprises and microfinance for business women in rural areas of South Africa - a case study of Ga-Rankuwa at the interface between first and third world

The majority of South Africa’s rural population lives below the minimum living standard; basic amenities are lacking with low financial aid. This study, therefore, explores the nature of microfinance and micro enterprises in South Africa, the challenges, and sustainability. Choosing Ga-Rankuwa, a township near to Pretoria, the impact of microfinance on local business women is examined. Even at this interface between first and third world, micro business women face typical third world problems and microfinance service is still in a developing stage, while, in most cases, finance is the major problem for micro business. However, a survey shows that especially in such a situation, there is both the market potential and the infrastructure which allow for a successful implementation of microfinance, but the interface between first and third world demands for governmental help and community service as initial sparks. Once established, this interface situation promises good chances for microfinance sustainability.

The Macroeconomics of Microfinance

We provide a quantitative evaluation of the aggregate and distributional impact of microfinance or credit programs targeted toward small businesses. We find that the redistributive impact of microfinance is stronger in general equilibrium than in partial equilibrium, but the impact on aggregate output and capital is smaller in general equilibrium. Aggregate total factor productivity (TFP) increases with microfinance in general equilibrium but decreases in partial equilibrium. When general equilibrium effects are accounted for, scaling up the microfinance program will have only a small impact on per-capita income, because the increase in TFP is counterbalanced by lower capital accumulation resulting from the redistribution of income from high-savers to low-savers. Nevertheless, the vast majority of the population will be positively affected by microfinance through the increase in equilibrium wages.

Micro Finance And Poverty Reduction: Case Study Of The Economic And Monetary Community Of Central Africa Countries

Microfinance is regarded by many international development agencies including the World Bank as an effective mechanism for poverty reduction. However, as pointed out by Zeller and Meyer (2002), the use of microfinance for poverty alleviation is not backed up with sound facts derived from rigorous research. Using survey data of around 2000 observations collected in the six countries of the Economic and Monetary Community of Central Africa, this study provides evidence of positive impact of microfinance on production activities of micro business and on living conditions of low income families.

Microfinance and Livelihood Development in Poor Coastal Communities in Eastern Sri Lanka

Various organizations are involved in micro-financial programmes in Sri Lanka. There is limited knowledge on the impact of microfinance on the livelihood improvements among poor coastal communities who were affected by Tsunami in Eastern Sri Lanka. This study investigated the effectiveness of microfinance support for coastal communities&rsquo; livelihood development in Trincomalee. A survey was conducted using stratified randomly selected 99 microfinance beneficiary households in three identified coastal villages in three Grama Niladhari Divisions in Kinniya. The analysis was based on 2006 information as a benchmark. The analysis was conducted using a multiple linier regression with the factors determining the revolving fund efficiency (RFE). The study found an average of 39.5% and 14.2% increase in income and private savings, respectively in agriculture sectors. Although the poor and the poorest groups have been reached by microfinance institutions, 65% of their clients seem to be from the non-poor groups. About 90% of the young people reported lack of opportunities for modern livelihood supports. The RFE was 0.32% indicating that it was not well adopted in practice. This may be due to lack of responsiveness of the Community Based Organizations (CBO). The results of multiple regression analysis showed that age, education and family income and weakly facilitated RFE was affected significantly by private savings. To improve livelihoods of poor coastal communities, effective capacity building of CBOs on microfinance management, training and technical supports to young people in alternative non traditional livelihoods and creating market opportunities are important. <strong>Key words</strong>: Livelihood; Microfinance; Coastal Communities; Eastern Sri Lanka DOI: <a href="http://dx.doi.org/10.4038/tar.v22i3.3706">http://dx.doi.org/10.4038/tar.v22i3.3706</a> &nbsp; <em>Tropical Agricultural Research </em>22(3) (2011) 330-336

Microfinance and women entrepreneurs in Pakistan

PurposeThe purpose of this paper is to outline findings of an initial exploratory study, undertaken as part of a larger ongoing research project, seeking to understand the influence and impact of microfinance on women's entrepreneurship and empowerment within developing countries such as Pakistan.Design/methodology/approachThe research conducted in this study used 37 semi‐structured questionnaires from women borrowers financed by two microfinance institutions of Pakistan.FindingsThe findings show that microfinance institution is providing credit to women for starting their business. However, 62 percent of the women borrowers established their own business from microfinance loan and other 38 percent did not use microfinance for the said purpose. The lack of training by microfinance institutions is also considered to be a factor in very less number of women starting new business from microfinance loan.Research limitations/implicationsA small sample is used from the Punjab province of Pakistan, therefore care is required when generalizing the results.Originality/valueThis paper will facilitate discussion in exploring the area of microfinance in a developing country and form a base for conducting research in future on the issue of microfinance and women's entrepreneurship.

Economic Impact of Micro Finance on Borrowers: Evidence from Punjab, Pakistan

The purpose of this study is to investigate the economic impact of microfinance institutions on borrower households in particular the impacts of small amount of loans in a high inflationary economy like Pakistan. The study is based on primary data and comprises of a sample of two hundred households including borrowers of microfinance institutions and non-borrowers who are eligible to be a client of MFIs. Binary logistic and least square regression is used to find the impact of microfinance on different economic indicators of the borrowers. Logistic regression results indicate positive and significant impact of microfinance on income of the borrower, while the least square regression presents somewhat different results about the impact of microfinance on assets of the borrower households. Independent sample T-test was used to measure the significant difference between clients and non-clients. We found that the economic position of the borrower households of microfinance institutions is better than the non-borrowers.

Measuring the Impact of Microfinance on Child Health Outcomes in Indonesia

Summary Microfinance has become a staple of modern development policy as a means to facilitate anything from gender equality to growth. It can facilitate the sharing of health-related information among parents, promote the bargaining power of women in the household, aid in the development of important health-related infrastructure, and help households smooth consumption in the wake of unexpected economic shocks. Using data from the Indonesian Family Life Survey (1993–2000), we find that the presence of microfinance institutions in communities significantly improves the health of children.

Assessing the potential impact of Microfinance with agent-based modeling

Recent empirical results have cast doubt on the value of Microfinance as a tool for reducing poverty. But, the difficulty lies in evaluating the impact of Microfinance in a world where the Microfinance institutions, their borrowers, and government policies are constantly changing. There is a need for a comprehensive and transparent framework to develop the theoretical grounds for believing in (or against) the efficacy of Microfinance, which can at the same time be used as a testing ground for policymakers. This paper presents a first attempt to develop an agent-based modeling (ABM) framework for pre-policy-implementation testing of the effects of Microfinance. Under the ABM paradigm, a set of behaviors for individual agents in the economy is used to construct a simulation whereby random interaction allows agents to change their state over time. Simulation of the model in different scenarios supported all our intuitions about Microfinance; in particular, there was positive impact of Microfinance on the wealth level of the poor. It was found that increase of available funds, easy access for producers and lower interest rates increase the effectiveness of Microfinance.

Measuring the Impact of Microfinance on Child Health Outcomes in Indonesia

Microfinance has become a staple of modern development policy as a means to facilitate anything from gender equality to growth. It can facilitate the sharing of health-related information among parents, promote the bargaining power of women in the household, aid in the development of important health-related infrastructure, and help households smooth consumption in the wake of unexpected economic shocks. Using data from the Indonesian Family Life Survey (1993-2000), we find that the presence of microfinance institutions in communities significantly improves the health of children.

Microfinance Impact and Innovation Conference 2010: Heralding a new era of microfinance innovation and research?

What do randomized control trials (RCTs) tell us about the impact of microfinance? This article reports on presentations at a three-day conference in New York in October 2010, ‘Microfinance Impact and Innovation Conference’, which provided evidence from RCTs on the impact of micro-insurance, asset-transfer programmes, savings and other aspects of microfinance. The article also raises questions about control over research into microfinance impact and innovation, and how far findings can be generalized.

Impact of microfinance bank on standard of living of hairdresser in Ogbomoso North local government of Oyo State, Nigeria

The thrusts of this study are to determine the impact of Microfinance bank on standard of living of hairdressers in Ogbomoso North local government area (LGA) of Oyo State and to examine the impact of Microfinance on asset acquisition and savings of hairdressers in that LGA. A total of 49 hairdressers who registered with Ogbomoso North LGA were used as study sample. Data were collected using questionnaire and hypothesis was used using chi-square technique. The null hypothesis was rejected at 5% significant level. It was then concluded that there is a significant relationship between Microfinance bank efforts and standard of living of hairdressers in Ogbomoso North LGA. Recommendations was thus made that government through the apex bank (CBN) should ensure that Microfinance bank loans are easily obtainable and repayment should include a grace period with reasonable schedule instead of weekly payment period that is commonly found among the microfinance banks in Nigeria.

High Noon for Microfinance Impact Evaluations: Re-investigating the Evidence from Bangladesh

Recently, microfinance has come under increasing criticism raising questions of the validity of iconic studies which have justified it, such as Pitt and Khandker. Chemin applied propensity score matching to the Pitt and Khandker data, finding different impacts, but does not disaggregate by gender of borrower. We first replicate Chemin and extend his analysis in two ways. We test the robustness of propensity score matching results to selection on unobservables using sensitivity analysis, and we investigate propensity score matching estimates of impacts by gender of borrowers. The mainly insignificant impacts of microfinance differ greatly by gender of borrower, but are all vulnerable to selection on unobservables. We are therefore not convinced that the relationships between microfinance and outcomes are causal with these data.

A study on SHGs demographic analysis, microfinance loan utilisation pattern and socio-economic performance of MFIs in India

Microfinance has emerged as a leading programme for poverty reduction round the globe. Indian microfinance sector has transformed from a fund-starved activity to one that can command patronage of multiple fund providers that includes banks, equity investors and donors, both domestic and international. In India many microfinance institutions (MFIs) have come into being, doing and expanding their business as per their social mission yet some have drifted. Therefore, it was envisaged to conduct a study to assess functioning of MFIs and investigating how they are promoting two bottom lines. The paper aims at analysing demographic profile, study socio-economic profile, and analyse the loan utilisation pattern and impact of microfinance on income levels of self-help groups (SHGs) members in the study area.

Impact of Microfinance Bank on Standard of Living of Hairdresser in Ogbomoso North Local Government of Oyo State, Nigeria

The thrusts of this study are to determine the impact of Microfinance bank on standard of living of hairdressers in Ogbomoso North local government area (LGA) of Oyo State and to examine the impact of Microfinance on asset acquisition and savings of hairdressers in that LGA. A total of 49 hairdressers who registered with Ogbomoso North LGA were used as study sample. Data were collected using questionnaire and hypothesis was used using chi-square technique. The null hypothesis was rejected at 5% significant level. It was then concluded that there is a significant relationship between Microfinance bank efforts and standard of living of hairdressers in Ogbomoso North LGA. Recommendations was thus made that government through the apex bank (CBN) should ensure that Microfinance bank loans are easily obtainable and repayment should include a grace period with reasonable schedule instead of weekly payment period that is commonly found among the microfinance banks in Nigeria.

The Impact of the Global Financial Crisison Microfinance and Policy Implications

The global financial crisis affected microfinance institutions (MFIs) as lending growth was constrained by scarcer borrowing opportunities, while the economic slowdown negatively impacted asset quality and profitability. It also brought to the fore the relatively high interest rates that MFIs charge to their (low-income) customers. This paper revisits the issue of systemic risk of MFIs, and finds that contrary to the evidence before the crisis, MFI performance is correlated not only to domestic economic conditions but also to changes in international capital markets. It also presents an empirical analysis of lending rates with the purpose of informing policy decisions, and finds that loan sizes, productivity, and MFI age contribute to explain differences in lending rate levels. This suggest that regulation (and policies) promoting MFI competition, and innovation in lending technologies have a better chance to result in decreased lending rates.

Daryl Collins, Jonathan Morduch, Stuart Rutherford, and Orlanda Ruthven. Portfolios of the Poor: How the World’s Poor Live on $2 a Day. Princeton, NJ: Princeton University Press, 2008. Pp. ix+283. $29.95 (cloth); $19.95 (paper).

Previous articleNext article No AccessBook ReviewsDaryl Collins, Jonathan Morduch, Stuart Rutherford, and Orlanda Ruthven. Portfolios of the Poor: How the World’s Poor Live on $2 a Day. Princeton, NJ: Princeton University Press, 2008. Pp. ix+283. $29.95 (cloth); $19.95 (paper).Shahidur R. KhandkerShahidur R. KhandkerWorld Bank Search for more articles by this author World BankPDFPDF PLUSFull Text Add to favoritesDownload CitationTrack CitationsPermissionsReprints Share onFacebookTwitterLinkedInRedditEmail SectionsMoreDetailsFiguresReferencesCited by Economic Development and Cultural Change Volume 59, Number 2January 2011 Article DOIhttps://doi.org/10.1086/657131 Views: 41Total views on this site Citations: 1Citations are reported from Crossref © 2011 by The University of Chicago. All rights reserved.For permission to reuse, please contact [email protected]PDF download Crossref reports the following articles citing this article:Hayyan Alia, Arvind Ashta, Zaka Ratsimalahelo A modified household economic portfolio model for assessing impact of microfinance using diaries, Qualitative Market Research: An International Journal 20, no.11 (Jan 2017): 2–27.https://doi.org/10.1108/QMR-06-2016-0054

High Noon for Microfinance Impact Evaluations: Re-Investigating the Evidence from Bangladesh

Recently, microfinance has come under increasing criticism raising questions of the validity of iconic studies which have justified the microfinance phenomenon. This paper applies propensity score matching (PSM), which has become widely used for the analysis of observational data, to the study by Pitt and Khandker (1998) which has been labelled the most rigorous evidence supporting claims that microfinance benefits the poorest especially when targeted on women. After carefully reconstructing the data we differentiate outcomes by gender of borrower, take account of borrowing from several formal and informal sources, and find that the mainly positive impacts of microfinance that we observe are shown by sensitivity analysis to be highly vulnerable to selection on unobservables, and we are therefore not convinced that the relationships between microfinance and outcomes are causal.