url
14
Jun
2014

THE IMPORTANCE OF MONITORING AND ENTREPRENEURSHIP CONCEPT AS FUTURE DIRECTION OF MICROFINANCE: Research Objectives

This study has the following objectives:
(i).    To assess the effectiveness of micro finance programs under AIM, TEKUN, YBK and LZS in enhancing respondents income level and supporting the development of entrepreneurial activities in Malaysia
(ii).    To explore the impact of monitoring on micro finance programs under AIM, TEKUN, LZS and YBK.
(iii).    To identify other factors that affect the effectiveness of micro programs under AIM, TEKUN, LZS and YBK.
Barringer and Ireland and Meccheri and Pelloni classified entrepreneurial activities into three components: growth-oriented entrepreneurship, life-style-oriented entrepreneurship; and life-supporting entrepreneurship. In this context, growth-oriented entrepreneurship refers to the formation of entrepreneurs that have the motivation to start their micro businesses with great potential to grow into larger scale, development of new technology, product and services. Life-style-oriented entrepreneurship refers to entrepreneurs that establish microenterprises to generate income for the households or to fulfill the life-style needs. Life-supporting entrepreneurship is more focused towards entrepreneurial activities that generate income to fulfill the basic needs and as a substitute to salary or wage-paying job. Based on such classification, entrepreneurship is seen as a process that enables change or develops an individual from a low to a higher standard. Of the three classes, growth-oriented entrepreneurship is seen to be the most ideal concept to be applied in micro finance program compared to life-style-oriented and life-supporting entrepreneurships. This is simply because of the fact that growth-oriented entrepreneurship emphasizes on life sustenance and self-performance, whereby change and growth should become the most important element to an effective micro finance program.
Based on a study by Alarape, the entrepreneurial concepts that have integrated in the micro finance program, such as creative thinking skills in identifying business opportunities, problem-based training, formation of linkages, risk evaluation, asset management and business formation, have the capacity to provide positive impacts on the micro business performance from the perspective of profit generation. He added that entrepreneurial concept is a continuous process and is not only limited to the process in starting a business. In fact, this process encompasses the activities that manage the development of microenterprise businesses.
The implementation of entrepreneurial concept in the rural areas is based on the community that has a strong family relationship and a potential impact on the community development. This can be seen from the establishment of micro finance program conducted by AIM which is based on the concept of Group Based Lending and integrated with the entrepreneurial concept. In this situation, the poor’s that wish to increase their family income level through a business should apply for group-funding to enable them to operate business activities on their own. Hence, the strength that can be seen in AIM is actually the efforts to establish and expand group members’ business continuously through the integration of entrepreneurial concept has its roots in the group or collective responsibilities. Group liability concept introduced by the Grameen Bank acts as a substitute to collateral in securing funding to enable group members to exploit the available resources and opportunities and create a value and transform ideas into reality.

This study has the following objectives: (i).    To assess the effectiveness of micro finance programs under AIM, TEKUN, YBK and LZS in enhancing respondents income level and supporting the development of entrepreneurial activities in Malaysia (ii).    To explore the impact of monitoring on micro finance programs under AIM, TEKUN, LZS and YBK. (iii).    To identify other factors that affect the effectiveness of micro programs under AIM, TEKUN, LZS and YBK. Barringer and Ireland and Meccheri and Pelloni classified entrepreneurial activities into three components: growth-oriented entrepreneurship, life-style-oriented entrepreneurship; and life-supporting entrepreneurship. In this context, growth-oriented entrepreneurship refers to the formation of entrepreneurs that have the motivation to start their micro businesses with great potential to grow into larger scale, development of

About The Author

Kevin J. Brandon

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