| dc.description.abstract | Microfinance programs have been designed for the poor people to access the formal
financial system easily without any collateral. From the beginning, microfinance programs
have been trying to reach the poor people to improve their living standard through income
generating activities. Following this objective, the Rural Development Scheme (RDS) and
Muslim Aid Bangladesh (MAB) are working with the poor vulnerable people to improve
their socioeconomic status through delivering interest-free microfinance in Bangladesh.
This study is therefore, aims to examine the effects of Islamic microfinance on borrowers’
household welfare. Towards the achievement of its objectives, this study used descriptive
and statistical techniques. To assess the effects, qualitative and quantitative data were
collected from 192 borrowers from Chittagong district of Bangladesh. Quota sampling
method was used to select the borrowers’. Quantitative techniques were used to analyze the
data. The descriptive results revealed that the RDS and MAB have been trying to provide
the handsome amount of loan and training to the clients to run their businesses though the
amount of loan and training were not sufficient. Determinants, time duration with
microfinance, client’s age and education level were found in the acceptable range but there
are some issues that need to be considered according to the clients’ needs. The findings
showed that the RDS and MAB effectively have increased the clients’ income. The RDS
and MAB also helped to raise their clients’ wellbeing through improve the expenditure
ability on food, clothing, child education, medical treatment, repair and maintenance.
However, in terms of improving the household’s asset accumulations, the RDS and MAB
still could not able to change the clients’ household assets as expected by the clients. Based
on the hypotheses testing, the findings revealed that the amount of loan, tenure, education
and age of borrowers had the most significant effects on income. In the case of overall
wellbeing, the amount of loan, tenure and borrowers income shown the significant effects.
This study also predicted that religiosity can act as a moderator in order to enhance the
effect of microfinance success factors on income and wellbeing. The results of the study
indicated that the role of religiosity as a moderator was evidenced on the relationship
between three influencing factors (amount of loan, tenure, and education level) and
income. On the other hand, the result was evidenced on the relationship between two
influencing factors (amount of loan and income) and wellbeing. Therefore, these findings
indicated that the overall welfare of the Islamic microfinance borrowers has increased after
receiving and using the microfinance loan. | en_US |
