Unique aspects of the Islamic microfinance financing process

Wulandari, Permata; Kassim, Salina; Sulung, Liyu Adhi Kasari; Putri, Niken Iwani Surya

doi:10.1108/h-09-2014-0062

Cited by 21 publications

(21 citation statements)

References 14 publications

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“…There are also research topics, specific to certain regions, which are not associated with any SI present in the MIX Market database. We found that in the financial dimension, Islamic banking is a relevant issue in EAP and South Asia [40,95,96], and the financial crisis and market saturation [97][98][99] are relevant issues in the LAC region; environmental issues like climate change [100,101], natural disasters [102] or the 2004 tsunami [103][104][105] are significant in Asia, and in the case of governance, the specific aspects investigated and not reported by region are corruption in South Asia [69,106], and accountability in Africa [107,108]. Concern for regulation is broadly researched and extends to all regions [28,109,110], among others.…”

Section: Divergencesmentioning

confidence: 80%

“…(1) When considering the individualistic-collectivistic dimension, microfinance research establishes a positive relationship in those societies more collectivist [40,41] and with higher levels of trust [41,42]. These circumstances are directly related to financial facts like considering self-help groups when granting funding, and in turn derived from social issues such as possible access to health services [43,44] or the consequences of this kind of repayment model, especially in the case of women [45,46].…”

Section: Literature Reviewmentioning

confidence: 99%

“…Hofstede's cultural dimensions show how national and regional cultures influence society's habits and behaviors. Likewise, the consequences of cultural differences have an impact on the functioning of institutions [39,40,53]. Therefore, as Hofstede (2001) [54] notes, at the organizational level, the management of any institution requires a cultural understanding of society and of the organization itself.…”

Section: Literature Reviewmentioning

confidence: 99%

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Microfinance Institutions Fostering Sustainable Development by Region

2020

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In the last few years, considerable attention has been paid to microfinance as a relevant participant in the formal financial system, whose target audience is people who are otherwise at risk of financial exclusion. In parallel, sustainability and the promotion of Sustainable Development (SD) are imposed as the theoretical frame when facing any study. This, connected with cultural and organizational dimensions theories, are the analytical framework for the analysis of the relationship between the context of performance in which Microfinance Institutions (MFIs) operate and their activity in promoting sustainability. A holistic approach is necessary to make operational these concepts; for that reason, financial, environmental, social and governance dimensions (FESG), and the balance among them, have to be considered. The main objective of the paper is to explore to what extent MFIs are fostering SD, and how this promotion is performed by region. For the analysis, two different sources of information have been studied: sectoral academic literature that focuses on the different sustainability dimensions, and MIX Market sustainability data obtained from the MFIs. A keyword analysis of the selected papers has been executed to be conscious of the most investigated aspects by region; on the data provided by the institutions, a Kruskal-Wallis H test has been performed to learn what the main Sustainability Indicators (SIs) are that are reported affirmatively. To obtain comprehensive research, a comparative study of the results offers the convergences, divergences and gaps of information in each of the regions. The findings show significant differences depending on the region, and confirm that operationalization should be adjusted at the regional context of the MFIs. The paper, with the inherent limitations due to data quality, also offers recommendations for the better promotion of sustainability in each of the regions.

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Section: Divergencesmentioning

confidence: 80%

Section: Literature Reviewmentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

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Microfinance Institutions Fostering Sustainable Development by Region

2020

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“…Dusuki (2008) contends that building skills through social intermediation are important for the success of Islamic microfinance. If support is extended during the pre-financing stage, financing stage and post-financing stage, then there is a greater chance of impactful results (Wulandari et al , 2016).…”

Section: Ensuring “Financial Sustainability” For the Programmementioning

confidence: 99%

Using Fintech in scaling up Islamic microfinance

Shaikh

2020

JIABR

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Purpose This study aims to propose a hybrid microfinance model that integrates various Islamic commercial and social finance institutions through Fintech for efficient and impactful results. The microfinance model caters to the financial and social intermediation needs through a set of financial services and non-financial support. Design/methodology/approach The study uses both a mathematical model and an empirical estimation using micro panel data to establish the core problem in microfinance operations. Conclusions from the mathematical model and estimated results in the empirical analysis are used to suggest an institutional design which embeds technology in the delivery of Islamic microfinance in an integrated structure. For screening and incentive conditions, the study gives illustration through numerical examples. Findings The mathematical model highlights the need for financial sustainability, outreach, scale and complementariness of non-financial factors such as commitment, repayment incentives and skills enhancement multiplier. In light of this, the proposed Islamic microfinance model is outlined to create synergies by integrating a diversity of funding sources through social savings and impact investments. The programme also blends financial services with non-financial support to ensure engagement and commitment on a long-term basis. It uses Fintech in various demand and supply-side operations to show how technology embeddedness can help in achieving cost efficiencies and extend outreach. Originality/value It is the first study in integrated institutional design in Islamic microfinance literature that embeds Fintech in both demand side and supply side operations comprehensively. The proposed model is conducive for enhancing outreach, scale and impact in the Islamic microfinancial services.

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“…This shows that developed countries have steeper diffusion curves on the Internet and shorter time lags than developing countries. Wulandari, et.al., (2016) 22 , highlighting the unique aspects of Islamic microfinance based on the experience of Baitul Maal Wa Tamwil (BMT) in Indonesia, Findings of the proposed Model include the characteristics of the poor in pre-financing, financing and post-microfinance products to be used as a reference for policy makers. This paper also found that each region has unique product preferences depending on the characteristics of the poor.…”

Section: Previous Studiesmentioning

confidence: 99%

Sharia Financial Inclusion Solutions and Strategies : Case of Mse-BMT in North Sumatera-Indonesia

Agus¹,

Widia²,

Segarahati³

2019

IJoBM

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Micro Small Entreprises (MSE) has a strategic role in Indonesia, but for its development still faces various complex obstacles. This study examines efforts to increase Islamic financial inclusion at UMK-BMT in North Sumatra, by conducting in-depth interviews with 3 experts from BMT in Medan City and Deli Serdang Regency, North Sumatra. Organizing FGDs on 3 expert participants and 4 MSE partners, then distributing questionnaires to these 7 people. The Analysis is carried out with a qualitative-quantitative research approach using the ANP method. This study found that what needed to be done as a solution and strategy were, the main internal solution was to improve MSE's HR, followed by solutions to improve MSE's performance, the solution to improve HR's main was a solution to improve expertise, followed by solutions to improve character, solutions to improve the performance of MSE's main is a solution to increase sales turnover, then a solution to increase profits, the main external solution is the BMT capital solution followed by the government solution and the motive solution for using digital media for MSE's -BMT. The main BMT capital solution is a solution to increase the use of WA followed by a solution to increase the use of internet access, Motive Solution for the Use of Digital Digital Media is a solution to increase access capability followed by a solution to increase effectiveness, a solution to increase affordability, a solution to increase security, a solution to increase flexibility and a solution to increase efficiency, Government Solutions The main solution is to improve training and solution to improve facilities. The main strategy in determining solutions and strategies agreed by all respondents is to increase training followed by government subsidy facilities, skills improvement, character building.

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Unique aspects of the Islamic microfinance financing process

Cited by 21 publications

References 14 publications

Microfinance Institutions Fostering Sustainable Development by Region

Microfinance Institutions Fostering Sustainable Development by Region

Using Fintech in scaling up Islamic microfinance

Sharia Financial Inclusion Solutions and Strategies : Case of Mse-BMT in North Sumatera-Indonesia

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