Microcredit Programs Research Articles

A review study on integrated farming systems

Integrated Farming systems (IFS), and methods of thinking about them, developed in place and time. Rapid change has occurred in the past two decades when agricultural and animal outputs rose, along with worries about their socio-economic and ecological tradeoffs. The use of farming systems research (FSR) to agricultural development was a reaction to issues emerging from a primarily reductionist approach to research and a cornucopian perspective of external inputs. Modern technology were either not accepted or produced unanticipated unfavorable trade-offs. This article examines definitions and types of FSR and the necessity for evolution in thinking about agricultural development. The article connects biophysical and socio-economic processes, provides a physical basis for the anthropomorphic notions of waste, and examines elements of objectivism and constructivism. It is claimed that FSR can only progress if the full significance of these problems is addressed in thinking about growth of IFS. The intricacy of the reality should make scientists think more carefully about the right approach that will bring people out of poverty. Research in Asia of replications of the renowned Bangladesh Grameen Bank micro-credit programs indicate that there is an ideal development for farm families in the sub-continent that even the impoverished aspire too. According to this experience impoverished women invest in little animals and the family bit by step climbs out of poverty. There is a significant and unmet need for study on local resources to respond to the requirements of these individuals.

An Empirical Evidence of Amanah Ikhtiar Malaysia (AIM) Microcredit Programme Participants’ Quality of Life

Since the inception of microcredit programmes, various studies have been carried out to assess their impacts. Earlier studies seemed to highlight this on the participants’ income and consequently poverty. However, recent impact studies of microcredit programmes have been looking into participants’ quality of life. Thus, this study attempted to investigate the impact of Amanah Ikhtiar Malaysia’s microcredit programme on the participants’ quality of life and analyse the differences between the new and old participants. This study took on a different perspective by examining aspects of personal attitude, subjective norm, perceived behavioural control, as well as entrepreneurial intention and behaviour. In selecting the samples, a probability sampling (disproportionate stratified) technique was employed. The hypotheses were tested using cross-sectional data of 638 Amanah Ikhtiar Malaysia participants. The findings of the study showed that all the hypotheses were significant and supported, where there was significant influence between participants’ personal attitude and entrepreneurial intention, participants’ subjective norm and entrepreneurial intention, participants’ perceived behavioural control and entrepreneurial intention, participants’ perceived behavioural control and entrepreneurial behaviour, participants’ entrepreneurial intention and entrepreneurial behaviour, including participants’ entrepreneurial behaviour and participants’ quality of life. On the contrary, the findings of the study revealed no difference in the quality of life between new participants and old participants. This study may contribute to the policy implications of Amanah Ikhtiar Malaysia’s microcredit programme, especially in improving training and guidance.

Microfinance and social capital formation- a social network analysis approach

The microcredit program has emerged as an important poverty alleviation strategy over the last three decades, and several studies have examined its economic impacts on the community well-being. However, far too little attention has been paid to the effects of micro credits on community social connection and solidarity. This paper aims to examine the application of Social Network Analysis (SNA) to explore the impact of the rural microcredit fund on community social capitals. In doing so, the data on interactions of four rural development groups' members before and after the microcredit project implementation were collected using participatory workshops in Neyzar village of Qom province in Iran. The data were analyzed by Ucinet software, and the socio-graphs were produced by the NetDraw application. The results show that, more people have been involved in the social interactions after the project implementation and there was statistically significant increase in density and decrease in centralization of cooperation network. Furthermore, there were no important distinctions in centrality of people with various educational levels before and after the project implementation. Overall, it can be concluded that, the microfinance initiative considerably promotes the community social capital and participation in the rural development activities. Moreover, the SNA techniques are applicable as an impact assessment tool to investigate changes in community social capital.

Microfinance and domestic violence

PurposeThe purpose of this paper is to document the impact of participation in microfinance programs on domestic violence against women.Design/methodology/approachThis paper uses the survey data from 69 villages in Bangladesh and the instrumental variable approach to estimate the effect of participation in microcredit programs on domestic violence.FindingsThe results show that women’s participation in microcredit programs does not reduce domestic violence. However, this result is possible only when the authors do not distinguish between female borrowers who have control over credit and those who do not have control over credit. Classifying female borrowers into these two categories can significantly change the results. The authors report significantly lower physical violence against those female who have control over credit. In case of psychological violence, the authors report no significant impact of control over microcredit.Originality/valueThe novelty of the paper lies in distinguishing between physical and psychological violence.

Missed Opportunities for Addressing Intimate Partner Violence Through Microcredit: Qualitative Findings From Bangladesh

Microcredit has shown mixed results when used to reduce intimate partner violence (IPV). This study explored microcredit and IPV in Bangladesh by conducting 12 focus groups with married men and women. Participants described challenges to microcredit participation highlighting "missed opportunities" for reducing IPV, including needs to (a) prevent violence sparked by loan disputes, (b) incorporate skill development to improve women's agency as a means of reducing IPV, and (c) mindfully engage men in the loan process to help address men's unequal gender ideologies. These modifications to microcredit programs are proposed to maximize positive change on gender and IPV.

Does the microcredit intervention change the life of the low- and middle-income households in rural Vietnam? Evidence from panel data

Existing studies have shown the important role of microcredit on poverty reduction, especially in developing countries like Vietnam. Although most studies conclude the positive impact of microcredit participation on poverty reduction through income generation, there remain mixed results. Besides, there has been limited research done on children’s education in Vietnam. This study is to measure the impact of the microcredit programme of the Vietnam Bank for Social Policies (VBSP) on poverty reduction (via income indicators) and children’s education (via the shares of kids and teenagers in school) of the poor- and middle-income households in rural Vietnam. The paper uses a set of econometric methods for static and dynamic analysis. The static models conclude that VBSP’s microcredit had significantly positive impacts on agricultural income per capita and significantly negative impacts on the total income per capita. The figures for non-farm non-wage income per capita and indicators of children’s schooling are not statistically significant. Moreover, the dynamic models indicate that the long-term impacts of microcredit on the selected outcomes are insignificant. From the estimated results, the study also suggests some policy implications.

THE ROLE OF DEVELOPMENT EXCHANGE CENTRE MICROCREDIT IN WOMEN EMPOWERMENT AND POVERTY ALLEVIATION IN KADUNA STATE, NIGERIA

The study focused on the role of Development Exchange Centre (DEC) microcredit in women empowerment and poverty alleviation in Kaduna State, Nigeria. Data for the study were collected using a well-structured questionnaire administered to 420 women farmers of beneficiaries and non-beneficiaries in the study area. The result shows the mean farming experience was 22 years for DEC beneficiaries and 19 years for non- beneficiaries while mean farm size for beneficiaries and non- beneficiaries was 2.0 ha. The result of the regression analysis showed that level of education, age and years of involvement in cooperative society were significantly related with level of participation. The mean crops output of DEC beneficiaries (437,807.1kg) was significantly higher than non- beneficiaries (145,571.4kg). The difference in the mean crops output levels was largely attributed to participation in DEC microcredit programme. The calculated Z-test value (14.74) for crops output and income (22.93) was significant at 1%. It was therefore recommended that DEC programme be extended to other farming communities in Kaduna State, so as to accelerate the poverty alleviation among women farmers in the State.

Can microcredit improve the risk management capacity of the poor fish farmers? Evidence from Bangladesh

ABSTRACT This study focused on assessing the opinions of the fish farmers concerning their risk management capacity under microcredit programs. Primary data were collected from male fish farmers living in the Mymensingh district of Bangladesh. Binary logistic regression was used to assess the opinions of the fish farmers as to whether their fishery risk management capacity had increased due to microcredit intervention. Propensity score matching technique was used to assess the impact of microcredit on the household incomes of the fish farmers. This study revealed that microcredit had a positive impact on increasing risk management capacity and on the household incomes of the fish farmers.

Effectiveness of Micro-Credit Programs in Socio-Economic Development: A Study on Selected NGOs in Bangladesh

Non-governmental Organizations (NGOs) evolved in Bangladesh with the commitment of bringing positive social change and attaining balanced socio-economic development through the disbursement of micro-credit among the marginal people in society. The main intention of the study is to assess the impact of micro-credit on the overall socio-economic development of micro-credit receivers. The Chi-square (χ2) and Multinomial Logistic Regression techniques have applied on primary data collected from 260 beneficiaries of micro-credit of ASA and BRAC NGOs in the Mymensingh district of Bangladesh. The χ2 analysis shows that the amount of micro-credit taken has a significant positive impact on respondents’ type of home, sanitation facilities, ownership of other household assets, health service received, yearly income, expenditure, and savings, and participation in family’s decision making, whereas an insignificant relationship is observed for occupational status, children education, ownership of land and livestock, sources of drinking water, economic solvency, and social status of the respondents.

Microcredit and Economic Welfare: Experience of Poor Rural Households from Pakistan

SummaryThis research article effort to empirically assess the effect of microcredit on household economic welfare consequences, for example income and consumption in rural Pakistan. The valuation is based on the difference‐in‐difference method that is a progressively popular technique of tackling the selection bias issue in measuring the influences of microcredit. This paper uses a 2‐year panel data set, together with both primary and secondary data gained through a household survey in rural Pakistan. Our empirical outcomes favour the full belief in the literature that participates in microcredit programme helps expand households' economic welfare, for example income and consumption. Despite the positive results on how microcredit has improved the rural households' living status, our outcomes display that the huge majority of the program applicants are non‐poor, which casts roughly uncertainties on the social potential (for example poverty alleviation) of Pakistan's microcredit programs. © 2020 John Wiley & Sons, Ltd.

Do Microcredit Loans Do What They Are Intended To Do? A Case Study of the Credit Village Microcredit Programme in China

AbstractThe purpose of this study is to assess if the credit village is an effective way to develop a microcredit programme in China from the perspective of poverty reduction policy and risk monitoring. Cross‐sectional household survey data from three credit villages in the Yunan County of China are analysed using 3SLS and IV probit models. The major finding is that the credit village loosens credit restrictions to some extent. However, it has no impact on educational expenditures, medical expenditures, long‐term assets, short‐term assets and women's rights. It is our observation that the microcredit programme in China needs more innovation to become effective. © 2020 John Wiley & Sons, Ltd.

Determinantes do crédito

O microcrédito ganhou destaque no Brasil e no mundo como uma modalidade de empréstimos para os microempreendedores, sobretudo os localizados no setor informal. No estado do Espírito Santo, em exemplo, a experiência de destaque é o Programa Nossocrédito, que conta com um grande número de atendimentos ao longo de seus anos de funcionamento. O objetivo deste trabalho é analisar os determinantes do crédito do Programa Nossocrédito do Espírito Santo no período de 2013 a 2015. Para tal, foram estudadas as relações das variáveis socioeconômicas como renda, população e o IFDM, bem como as variáveis sexo e setor para onde o crédito é destinado, além do faturamento bruto dos microempresários, para verificar se essas variáveis exercem algum efeito sobre o nível médio de crédito concedido pelo programa aos municípios capixabas. Como instrumento, utilizou-se de modelagem econométrica do tipo dados em painel com efeitos fixos. Os resultados encontrados apontaram para um efeito positivo da população e do PIB per capita dos municípios no valor médio de crédito concedido, o que demonstra que o programa atende majoritariamente aos municípios mais populosos e com maiores PIB per capita. Em contrapartida, os municípios considerados menos desenvolvidos pelo IFDM, que destinam mais créditos para o setor informal e para tomadores do sexo feminino, contaram com um menor valor médio de crédito emprestados. Conclui-se que as variáveis socioeconômicas exercem influência sobre a quantidade de crédito fornecida pelo programa e que o Nossocrédito apresenta algumas dificuldades para atender ao público alvo dos programas de microcrédito.
 Palavras-chave: Crédito. Dados em Painel. Microcrédito. Desenvolvimento Regional.

Micro-Credit Programs for Empowering Women to Alleviate Poverty

Micro-Credit Programs for Empowering Women to Alleviate Poverty

Mobile Devices in supporting members’ participation to Village Community Banks: The Design Thinking Approach

Village Community Banks (VICOBA) and mobile phones have become assistance to many rural societies in encountering financial problems. However, mobile phone usages to VICOBA are isolated resulting in unsubstantial benefits that do not foster member’s participation. The weak participation of members to Village Community Banks activities has been one of the major impediments to their success despite owning of mobile devices to some members. The paper applies design thinking approach to explore the situation through identifying the deficiency available in mobile devices to VICOBA microcredit programmes in enhancing member’s participation and suggest the effective usage pattern The study captured 7 groups of village community banks at Ndungu village with a total of 70 members whereas 48 female and 22 male participants. The study employed interview, observation and focus group discussion for data collection. Content analysis and coding approaches were used to analyse data and interpreting findings. The findings observed that there is a big potential in mobile phone use to village community banks activities and explicitly linking between design thinking and the qualitative data collection methods in the inception phase of the design process has been perceived to exist

An Analysis of the Factors Influencing Choice of Microcredit Sources and Impact of Participation on Household Income

AbstractIt is widely accepted that rural microcredit has the potential to contribute to poverty reduction in developing countries. This paper examines the factors that affect rural residents' decisions to participate in different types of microcredit sources and how these factors influence household income and consumption, using cross‐sectional data from a recent survey in China. We use a multinomial endogenous switching regression model to account for selection bias and treatment effects. The empirical findings indicate that family size, dependency ratio, local casual wage rate, credit information and shocks mainly determine the selection of different credit sources. Furthermore, the estimates reveal that participation of households in microcredit programmes contributes to an increase in both per capita income and consumption significantly. © 2020 John Wiley & Sons, Ltd.

Institutional Logic of Various Development Actors in Microcredit Program (Case study: Group-Based Microcredit Program (KMBK) in Sukorame Village, Binangun District, Blitar Regency, East Java, Indonesia)

The effforts to facilitate community’s participation and encourage their contributions to the decision making process has led to increased development initiatives. Among community development initiatives, the program of Group-Based Microcredit Program (KMBK) has been recognized by development stakeholders as a development approach that offers poor people access to financial services (financial intermediation). In addition, social intermediation in the form of training programs (capacity building) is the key success in eradicating poverty in sustainable development. This study aims to compare the institutional logic of various development actors in the KMBK program in Sukorame Village, Binangun District, Blitar Regency, East Java, Indonesia. This study found that there are differences in institutional logic between development actors in the microcredit program to support sustainable development, namely 'economic logic' and 'development logic'.

Contextual Factors Which Affect the Success of Microcredit Programs Among Women

Microcredit programs usually target poor rural women to reduce poverty and empower the women involved. The general body of existing research provides conflicting evidence, depending on context, poverty reduction and empowerment may or may not be partially achieved. Research on the effects of context on microcredit is limited in Ghana. Based on focus group discussions and in-depth interviews with stakeholders, the contextual factors that affect microcredit for poverty reduction among women are explored. The findings of this study suggest that the orthodox use of social collateral through group lending doesn’t fully account for why some microlending programs are effective, and others are not. Contextual factors appear to make the difference.

The impact of microfinance on Indonesian rural households' welfare

PurposeThis study investigates the welfare impact of microfinance on rural households in Indonesia. Its finding will bridge the gap in the Indonesian microfinance literature.Design/methodology/approachThe research was conducted by collecting primary data and administering a structured questionnaire to rural households in Bantul District, Yogyakarta Province, Indonesia. We employed the logistic model to measure welfare impacts of microcredit borrowers.FindingsThe research finds that purpose of loan, monthly income, monthly expenditure, interest rates, loan amount, education and marital status have significant effects on the probability of increasing borrowers' welfare after accessing microcredit.Practical implicationsThis study will propose some policy recommendations for Indonesian policymakers that may yield better strategies to help improve the impact of their microcredit programmes on the welfare of rural households.Originality/valueThe authors confirm that the article has not been submitted to peer review, nor is in the process of peer reviewing and nor has been accepted for publishing in another journal. The author(s) confirms that the research in their work is original, and that all the data given in the article are real and authentic.

The Effectiveness of the Government Rural Social Services Microcredit Programme in Bangladesh

The aim of this article is to measure the economic impact of Rural Social Services (RSS) microcredit programme on its participants. Multistage random sampling method was applied to select total 1,008 beneficiary respondents (households) and 504 control respondents (households) from Bangladesh. The propensity score matching (PSM) technique was applied to analyse the outcome of RSS micro-credit interventions. The results show that there were statistically significant differences in income, food expenditure, and non-food expenditure between the programme and non-programme participants. The result of this survey also reveal that after taking RSS loan, 4.34 per cent graduated from category A to B, and 8.41 per cent graduated from category A to C. On the other hand, 30.43 per cent loan takers graduated from category B to C. This result proves that RSS loan helps a certain number of families uplift their income position. The study suggests to further focus on knowledge and skills development of the poor people.

Impact of Microcredit on Second Generation Borrowers in Bangladesh: Revisited

This article investigates the economic impact of continuing borrowers’ participation in the microcredit programme on poverty eradication in Bangladesh. A panel data set was collected through a field survey for the years 2013–2016 to identify the impact of a microcredit programme on continuous participation borrowers. The propensity score matching (PSM) method is used to eliminate selection bias and the difference-in-difference (DID) model is applied for the empirical analysis. The findings of the study demonstrate that more benefits are realized from continued participants compared to discontinued participants. JEL: C83, D14, G21, O12