...Islamic Economic Studies Vol.9, No. 2, March 2002 FINANCING MICROENTERPRISES: AN ANALYTICAL STUDY OF ISLAMIC MICROFINANCE INSTITUTIONS HABIB AHMED ∗ While conventional microfinance institutions (MFIs) have expanded their operations in the last two decades, poverty-focused MFIs based on Islamic principles are lagging behind. This paper provides the theoretical basis, operational framework, and empirical support for the establishment of Islamic MFIs. After critically evaluating the conventional MFIs, an Islamic alternative is presented. The theoretical part of the paper shows that there is a great potentiality of Islamic MFIs that can cater for the needs of the poor. Islamic MFIs have some inherent characteristics that can mitigate some of the problems faced by conventional MFIs. Empirical evidence from three Islamic MFIs operating in Bangladesh, in general, supports some of the theoretical assertions. The case studies, however, reveal that Islamic MFIs have not yet tapped some of the sources of funds, nor have they used the variety of financial instruments in their operations. 1 ?. INTRODUCTION With the failure of experimenting in top-down (trickle down) development policies for a few decades to alleviate poverty in most developing countries, financing microenterprises is considered a “new paradigm” for bringing about development and eradicating absolute poverty. 1 Though the importance of developing small-scale enterprises has been discussed for a long time, the innovative...
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...AND MICROFINANCE IN REDUCING POVERTY IN LDCS 4. EFFECTS OF SUSTAINABLE MICROENTREPRENUERSHIP ON LDCS 5. CONCLUSION 6. REFERENCES 1. INTRODUCTION About 90 percent of the people in developing countries lack access to financial services from institutions, either for credit or savings1, which further fuels the “Vicious Cycle of Poverty” (refer to Fig. 1). If the people of LDCs have a limited capacity to invest in capital, productivity is restricted, incomes are inhibited, domestic savings remain low, and again, any increases in productivity are prevented. A lack of access to financial institutions also hinders the ability for entrepreneurs in LDCs to engage in new business ventures, inhibiting economic growth, and often, the sources and consequences of entrepreneurial activities are neither financially nor environmentally sustainable (existing for continuing future use). Microfinance serves as a means to empower the poor, and provides a valuable tool to assist the economic development process. However, unavoidably, various barriers and obstacles limit the roles of microfinance, entrepreneurship and sustainability in reducing poverty in LDCs around the world. 1 Robinson, Marguerite S., 2002, “The Microfinance Revolution: Sustainable Finance for the Poor” Fig 1. The Vicious Cycle of Poverty In addressing this issue,...
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...NORGES HANDELSHØYSKOLE Bergen, spring 2010 THE IMPACT OF PROVIDING BUSINESS TRAINING TO MICROFINANCE CLIENTS: Empirical Evidence from Tanzania Guro Landsend Henriksen Svein Olav Svoldal Supervisor: Erik Øiolf Sørensen Master Thesis in Economics NORGES HANDELSHØYSKOLE This thesis was written as a part of the Master of Science in Economics and Business Administration programme - Major in Economics. Neither the institution, nor the advisor is responsible for the theories and methods used, or the results and conclusions drawn, through the approval of this thesis. ABSTRACT This master thesis studies the impact of providing business training to microfinance clients in Tanzania. Based on data collected six months after the programme ended, we cannot confirm positive treatment effects from business training on the micro entrepreneurs’ profits. However, treated entrepreneurs have higher likelihood of operating multiple businesses; increased their engagement within commerce and reduced their engagement within manufacturing. Based on the market situation at the time, these changes all represent advancement towards business structures associated with higher profitability. Moreover, findings of low profitability in new establishments can serve as an explanation to the small effect from business training on profits, and imply that treatment effects will be manifested in higher future profits of the entrepreneurs. 2 TABLE OF CONTENTS Abstract ...................
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...the Evidence with Practical Suggestions for the Way Forward Lisa Xu Bilal Zia Public Disclosure Authorized Public Disclosure Authorized The World Bank Development Research Group Finance and Private Sector Development Team June 2012 Policy Research Working Paper 6107 Abstract Financial literacy programs are fast becoming a key ingredient in financial policy reform worldwide. Yet, what is financial literacy exactly and what do we know of its effectiveness? This paper collects insights from the literature thus far and summarizes global evidence on financial literacy, its correlates, and existing and upcoming causal investigations. The authors conclude with a synthesis of policy advice and practical suggestions for the way forward in this fast growing area of research. This paper is a product of the Finance and Private Sector Development Team, Development Research Group. It is part of a larger effort by the World Bank to provide open access to its research and make a contribution to development policy discussions around the world. Policy Research Working Papers are also posted on the Web at http://econ.worldbank.org. The author may be contacted at bzia@worldbank.org. The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the...
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...Journal of Sociology and Social Policy 30 Whose Solution is It? Development Ideology and the Work of MicroEntrepreneurs in Caribbean Context by Marina Karides, Florida Atlantic University An economic leader in the Caribbean, the Republic of Trinidad and Tobago has incorporated micro-business development as one of its main strategies to alleviate poverty and unemployment and to spawn economic growth since the late 1980s (ILO 1991, 1998, Ministry of Finance 1996). Although the discovery of natural gas in the early nineties catapulted Trinidad’s economic growth rate to four percent per annum, unemployment and poverty continue to affect a large portion of the population. The majority of the population has not benefited from Trinidad’s economic growth. Thus, the government has attempted to create “a nation of entrepreneurs” in order to relieve some of the inequality that defines the society (Ministry of Trade and Industry 1997). Trinidad’s expansion of micro-enterprise programs reflects an international trend. Endorsed by non-governmental organizations, private financial institutions, international development agencies, including the World Bank, many scholars and development practitioners also view microenterprise assistance as a panacea for Third World poverty (Johnson and Kidder, 1999; Mosley and Hulme, 1998; Dignard and Havet, 1995; Grosh and Somolekae, 1996; Rakowski, 1994). Micro-enterprise development programs generally consist of training in business skills or providing...
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...Netherlands Water Partnership Program (BNWPP) Contents Preface........................................................................................................................vii Abbreviations and Acronyms....................................................................................xi Executive Summary.................................................................................................xiii Background and Context .................................................................................xiii Objectives ....................................................................................................... xiv Coastal Electrification and Women’s Development Microenterprise (CEWDM) ............................................................................................. xv Development of Training Modules ................................................................... xv Operational Performance................................................................................ xvi Social Outcomes............................................................................................. xvi Electrification Options as a Function of Household Income .......................... xvi Costs of Rural Lighting and Electrification......................................................xvii Sustainability Issues ....................................................................................... xix The Role of Microcredit in Off-Grid Market Growth..............
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...IMICRO-FINANCE OF MOBILE ENTREPRENEURSHIP IN NIGERIA: AN ANALYSIS OF SELECTED CASE STUDIES IN BENIN CITY BY DADA ADEYINKA PSC0709051 DEPARTMENT OF POLITICAL SCIENCE AND PUBLIC ADMINISTRATION FACULTY OF management SCIENCES UNIVERSITY OF BENIN BENIN CITY. DECEMBER, 2015. MICRO-FINANCE OF MOBILE ENTREPRENEURSHIP IN NIGERIA: AN ANALYSIS OF SELECTED CASE STUDIES IN BENIN CITY BY GLORY PSC0709051 IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE AWARD OF THE BACHELOR OF SCIENCE (B.SC) DEGREE IN POLITICAL SCIENCE AND PUBLIC ADMINISTRATION, FACULTY OF MANAGEMENT SCIENCE OF THE UNIVERSITY OF BENIN DECEMBER, 2015. CERTIFICATION This is to certify that the exercise here by described in the research work was carried out behind the Faculty of Physical Science, University of Benin, under my supervisor. ____________________ ____________________ Dr. B.E. Iyorzor Date Project Supervisor ____________________ ____________________ Dr. E.O Aiyohuyin Date Head of Department DEDICATION I dedicate this project to Almighty God who has always giving me the grace and privilege financially and otherwise to do this project and to my lovely family, who gave me moral courage in the cost of writing this project. ACKNOWLEDGEMENT This completion of this work would not have been possible if not for the support which I received from many people. My thanks...
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...does not represent the official stand of the Government of the countries studied. 2 | State of Microfinance in Bangladesh List of Acronyms ADB ASA BBS BDT BEES BIDS BKB BMDA BRAC BRDB BSBL CARB CBO CBN CDF CFPR CIDA COSOP CPD DANIDA DFID DOL DOF EC FSP FSS FY GB GDP GOB HCP HIES IBBL IFAD IGA IGVGD InM JC LGED ME MFMSP Asian Development Bank Bangladeshi NGO (formerly Association for Social Advancement) Bangladesh Bureau of Statistics Bangladesh Taka Bangladesh Extension Education Services Bangladesh Institute of Development Studies Bangladesh Krishi Bank Barind Multi-Purpose Development Authority Building Resources Across Communities (Largest NGO) [Formerly Bangladesh Rural Advancement Committee] Bangladesh Rural Development Board Bangladesh Sanchya Bank Limited Center for Agricultural Research-Barind (a Bangladeshi MFI) Community Based Organization Cost-of-basic-needs Credit and Development Forum Challenging the Frontiers of Poverty Reduction Programme Canadian International Development Agency Country Strategic Opportunities Paper (of IFAD) Centre for Policy Dialogue Danish International Development Agency Department for International Development Department of Livestock Department of Fisheries European Commission Financial Service for the Poorest Financial Self-sufficiency Fiscal Year Grameen Bank Gross Domestic Product Government of Bangladesh Hardcore Poor Program Household Income and Expenditure Survey Islami Bank Bangladesh Limited International Fund for Agricultural...
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...CHAPTER 1 1.0 INTRODUCTION The concept of micro finance is not new in the world, sub-Sahara Africa and in Kenya. Savings and credit groups have operated for centuries all over the world. They include the Chit Funds of India, Tandas in Mexico, and Arisan in Indonesia. In Africa such groups consist the “Susu” of Ghana, BOSCA of Botswana, ADESSI of Burkina Faso, ACCORD of Uganda, Zusa of Zambia among others. In Kenya on the other hand Micro Finance Institutions (MFIs) include Faulu Kenya, Kenya Women Finance Trust (KWFT), KUSCCO (Kenya Union of Savings and Credit Cooperatives), Economical Locus Fund (ECLOF), Small and Medium Enterprise Programme (SMEP), Kenya Small Traders and Entrepreneurs Society (KSTES), the Kenya Post Savings Bank (KPSOB) and Vintage Management (Jitegemee Trust). Microfinance is the provision of financial services to low income households and micro and Small Enterprises (MSEs). The sector provides an enormous support to the economic activities of the poor thus contributing to poverty alleviation. Micro finance is usually understood to entail the provision of financial services to micro entrepreneurs and small businesses, which lack access to banking and related services due to the high transaction costs associated with serving these clients’ categories. The two main mechanisms for the delivery of financial services to such clients are relationship based banking for individual entrepreneurs and small businesses; and group based models, where...
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...Problems and Prospects of Remittance Service in the Public Banking Sectors of Bangladesh (A study on Janata Bank Limited) [This internship report has been prepared as a partial fulfillment of the degree of Bachelor of Business Administration from Daffodil International University] SUBMITTED TO SheikhAbdur Rahim Assistant Proffesor Department of Business Administration Daffodil International University SUBMITTED BY Date of Submission: 2012 DAFFODIL INTERNATIONAL UNIVERSITY © Daffodil International University Library Page i Letter of Transmittal January, 2012 SheakAbdur Rahim Lecturer in Department of Business Administration Daffodil International University Subject: Submission of internship report for kind acceptance Dear Sir I am profoundly contended for being able to submit Internship Report on “Problem & prospects of remittance service in public banking sectors of Bangladesh (A case study on Janata Bank Limited)”which you have assigned me as partial requirement of BBA program. I have tried no stone unturned to prepare this report sincerely according to your advice, guidance, instructions and suggestions. It was a great source of inspiration and pleasure for me to work on this report. I shall be very glad to furnish with any explanation on this report necessary. Despite my great caution, I cannot but express my great concern to make any sort of mistakes. If such condition takes place, I would expect your sympathetic and graceful consideration...
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...China Microfinance Industry Assessment Report By He Guangwen, Du Xiaoshan, Bai Chengyu, and Li Zhanwu China Association of Microfinance Feb. 17, 2009 This report has been jointly accomplished by Prof. He Guangwen, Director of Rural Finance and Investment Research Center of China Agricultural University (CAU), Prof. Du Xiaoshan, Deputy Director of Rural Development Institute of China Academy of Social Sciences (CASS) and Chairman of Board of Directors of China Association of Microfinance (CAM), Mr. Bai Chengyu, Director of Division III of China International Centre for Economic and Technical Exchange (CICETE) and Secretary General of CAM with the support of the Network Strengthening Program (NSP) of CAM. Mr. Li Zhanwu, Division Director of Ministry of Human Resource and Social Security, Dr. Li Lili of Henan University of Finance and Economics, Dr. Zhang Zhengping, Associate Professor of Beijing Technology and Business University, Dr. Yang Jing of Beijing Material College, and Li Yaning, Yang Lu and Wang Dan from CAU have also joined the research work. Besides, this report has obtained the guidance and assistance from Ms. Wang Dan, Managing Deputy Secretary General of CAM, and the experts of SEEP. Mrs. Wang Li, President of Social Responsibility Department of Citi China has provided strong administrative and professional support. Hereby, special thanks should be given to the above fellows. For more information, pls contact Prof. He Guangwen at heguangwen@sina.com 1 ...
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...TERMS * Rural Financial Services Project (Africa Development Bank, German Agency for Technical Cooperation, World Bank): refers to a project being undertaken by the above bodies to provide financial services to the rural dwellers to enhance development. * Credit risk: This refers to the degree to which it is likely that a borrower or debtor may not repay a loan or debt. It also means a particular borrower or debtor perceived by a lender or creditor as being particularly not likely to repay a debt. (Microsoft Encarta 2007). | | | INTRODUCTION Poverty is one of the problems faced by the people living in the rural areas and this largely affects their lifestyles both socially and economically. Along with poverty, many other social problems or issues can be pointed out including unemployment, lack of education, lack of proper governance and over population. These problems are associated with poverty and most of the time regarded as causes or effects. In government’s bid to eradicate poverty from the rural areas, it adopted strategies and one of such strategies is microfinance. Microfinance involves the application of innovative methodologies that make financial services available to relatively poor households and microenterprises. Microfinance can also be termed as the practice of providing financial services including micro credit, micro savings and micro insurance to poverty stricken or poor individuals, such that they are assisted to collect large sums of money...
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...Success of Microfinance in Bangladesh: Its Determinants, Impacts & Challenges Chapter- One Introduction 1.1 Introduction: In recent years, microcredit, in its wider dimension known as microfinance, has become a much favored intervention for poverty alleviation in the developing countries and least development countries. There is scarcely a poor country and development oriented donor agency (multilateral, bilateral and private) not involved in the promotion (in one form or other) of a microfinance program. Microfinance programs claim many achievements as its impact and an outside observer cannot but wonder at the range of diversity of the benefits claimed. Although Bangladesh has huge potential for development, it is, for various socio-economic reasons, among the poorest countries in the world. About half of the country's population lives below the poverty line with 80% in the rural areas. The burden of poverty falls disproportionately on women, who constitute half of the total population. Logically, therefore, poverty alleviation and creation of rural employment are top priorities in the development agenda of the government of Bangladesh (GOB) which has adopted a broad based approach to poverty alleviation, emphasizing macroeconomic stability, economic liberalization, and support for a number of government agencies and non-government organizations (NGOs). Substantial progress has been made in implementing the microcredit program (MCP), and the scope for its efficient...
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...The Effect of Nigeria Power Sector Reform on Private Sector Investment ONOWA SIMON OWOICHO BENUE STATE UNIVERSITY, MAKURDI Abstract Electricity generation, transmission, and distribution are a ubiquitous and integral part of any modern economy. Aside from providing households with all the conveniences of electric power, a modern and reliable electricity sector contributes to efficient overall economic production and plays an important role in determining Nigeria’s competitive advantage. But in addition to its role of providing a source of energy, the electricity sector also contributes to lifting overall Nigerian economic activity and employment through its capital investments in electricity infrastructure. This report assesses the economic impact of Nigerian power sector reform on private sector investment. The methodology used allowed us to calculate economic multipliers—rules of thumb that link new investment in the sector to overall economic activity. The economic multipliers are valuable for planning because they link each dollar of additional investment by the industry to a given dollar value of overall economic output, job creation, and tax revenues. Moreover, this report links the occupational requirements of these increases to capital spending—highlighting the number of workers and skills to put in place future electricity generation, transmission, and distribution capacity. 1 Introduction The availability of reliable Electric Power to the homes and businesses...
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...economic growth and employment generation in the Indian context .the article how policy environment for promoting MSMEs changed from ‘protectionism ‘during the pre-1990s to ‘export orientation’ during the post-1990s. The key constraint faced by the MSMEs including access to credit and technology, redtapism and the like. The MSEs to promote the rural economy for in general and rural women empowerment in particularly the rural women are taken ,economic improvement ,social development, and individual decision making through the . MSEs.the MSEs are promoting the rural entrepreneurship. Key words: MSME, SME , SSI, Credit Rating Introduction Indian economy based on rural economy .Father of nation mahatma Gandhi told India “lives in village”. T he r eal national development through the rural economy .the development of rural economy through the r ur al bas ed micr o, small a nd medium enterprises, The most of the entrepreneurs are micro rural the micro enterprises mostly participate rural women through the self help Groups and unregistered groups and NGOs In India, plans and policies as well as the for mation have laid str ess on women SELP Journal of Social Science 21 empower ment. Empower ment pr ovides author ity and social justice for human development. Empower ment of...
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