A Case Study about Selecting High-income Generating Activities for Micro-entrepreneurs: Amanah Ikhtiar Malaysia
Abstract:~ Poverty eradication has been one of the most important concerns in developing countries. Many of the governments of these countries have initiated some forms poverty alleviation programs to reduce poverty level in their respective countries. Studies have shown that microfinance is proven to be an effective tool to fight poverty in many developing countries. This study looks at various income generating activities taken up by micro-entrepreneurs who obtained micro-credit from Amanah Ikhtiar Malaysia (AIM), the biggest microfinance institution in Malaysia, and identifies which activities result in high income. A survey was conductedto obtain primary data on economic activities assumed by AIM members and also income obtained from these activities.
Introduction:~ Although to a certain degree overlooked by conventional financial institutions, microfinance is at present demonstrating good potential, and funding microfinance project has become a main concern for international donors as well as for governments, private companies and philanthropic organizations (Ferro, 2005). There are several reasons why financial institutions may not be interested with microfinance, such as the real profitability of microfinance, the high risk posed by small and short-term lending operations and the widespread belief that the poor are often poor due to a lack of skills. Furthermore, it is extremely difficult for financial institutions, particularly in less developed countries, to overcome the social and cultural barriers in providing microfinance services. Keep reading…
