Literature review on microfinance in pakistan
Objectives of the study Following are the major objectives to be achieved in this research work.
Research paper on microfinance pdf
Our target institutions in this study i. According to a survey by CGAP, Islamic MFIs reach , clients through institutions operating in 14 countries and an estimated 80, clients through a network of Indonesian cooperatives. However, despite the successful stories on microfinance, studies continue to show that poverty is still a big problem for the developing world. This paper supports welfarist approach and is an impact study of Islamic microfinance institutions working in Pakistan. Bangladesh and Pakistan are custodians of million poor followed by India with million people living below poverty line Obaidullah, This approach has been criticized by many researchers as microfinance institutions might run into loss without sustainability which could lead to less number of poor to be served and even shutting down Robinson, ; Woller et al, ; Rosenberg , p. It is stated in the study that age is an important demographic factor and poverty level increase with the age of the family head. Khandker and Samad show that in the long term access to microfinance has helped increase income, consumption and assets for MFI members. He picked up landholdig, assets possession, family members per house hold, education, age and gender as the variables in order to find out their role in alleviating poverty in rural areas.
Morshid and Abdullah conducted a study on the effetiveness of islmic microfinance in Brunei Darussalamandstated that the islamic microfinance project of Department of CommunityDevelopment JAPEM has strong effect in increasing number of assets for the clients.
To eliminate poverty, microfinance has been in place for a number of years. Jaffari et al.
Clients of these institutions are selected with purposive non-probability sampling technique. Islamic microfinance is the convergence of Islamic finance and microfinance. Akhuwat foundation is providing QArz e Hassan, Farz.
Review of related literature on microfinance
He observed that this behavioral change in clients of IBBL along with access to microfinance has influenced their income, crop productivity, empoyment and expenditure in a positive way. It is stated in the study that age is an important demographic factor and poverty level increase with the age of the family head. It is used when respondents are selected through deliberate judgments with respect to particular group or area Kerlinger, It, further, demonstrates that most of them borrowed from their friends and relatives in pursuit of Halal method of borrowing. As interest is strictly forbidden in Islam therefore most of the practicing Muslims try to avoid conventional microfinance. It is suggested in their study that taking assets as a measurement of poverty is better then taking income or wealth as a determinent of poverty since assets are long run wealth while income is short run. This studyreported that household income of the recipients is positively affceted by microfinance. The country faces a lot of the development challenges which include poverty and incompetent human resources moreso in the informal sector where the majority of the people are poor. Institutionalist approach argues that the fundamental aim of microfinance is to build a financial system that is sustainable and that can provide financial services to greater number of poor. They insist that emphasizing upon the depth of outreach is the key to building a sustainable institution. If well planned and well integrated within the microcredit services, education can serve a good purpose in poverty alleviation. Ferreira and Ravallion note that one billion people subsisting on per capita incomes less than one dollar per day live in developing countries. Methods Current study is an effort to evaluate and observe the impacts of various Islamic modes of financing on household welfare of the poor of Pakistan. According to him, age play quite important role, as is played by gender, in finding out per capita income in a less developed country like Pakistan.
Rahman took a sample of respondents and reported that a significant number of respondents are observing their religion better than they used to do in past. Savings have been overlooked Vogel, which are even more important for poor.
Despite special focus of nongovernmental organizations and public sector institutions like Benazir Income Support program BISP on poverty alleviation and socioeconomic uplift of the deprived there is dearth of literature available on impact assessment of suchinstitutions.
Chaudhry cocluded in his study that poverty level in rural parts of Southern Punjab in Pakistan can be reduced by lessening the size of household, getting the education level of poor better, by increasing the number of assets possessed by each household, by increasing the contribution of females in labor force and by improving condition of the access of labor to market.
based on 33 review