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Title:	An analysis of microcredit performance determinance on credit coverage, lower income group and credit quality in Malaysia
Authors:	Thilagarani Selvaraj (P76473)
Supervisor:	Zulkefly Abd. Karim, Assoc. Prof. Dr.
Keywords:	Microfinance Universiti Kebangsaan Malaysia -- Dissertations Dissertations, Academic -- Malaysia
Issue Date:	31-Jul-2019
Description:	The thesis examines the issues of microcredit performances in Malaysia. Accordingly, it should be noted that, Microcredit Organisation (MO) was established to complement the mainstream financial institution but challenges remain with microcredit performances associated with microcredit coverage proxy by depth of microcredit (DPTH) and breadth of microcredit (BDR), lower income group household (B40HC) proxy by bottom 40% household income group and microcredit quality (microcredit at risk) proxy by number of credit late in repayment. Hence, the main points of the study are to analyse three main objectives as follows: i) the effects of macroeconomic condition on microcredit coverage, ii) the effects of microcredit and macroeconomic condition on B40HC, and iii) the determinants of microcredit quality. In order to achieve the first and second objective, the static panel data technique was adopted, which comprises 13 states and 3 Federal Territories in Malaysia, spanning 2011 to 2015. The third objective adopts dynamic panel data technique namely Generalized Method of Moments (GMM) on a total of 213 MOs branches all over Malaysia from 2011 to 2015. The findings from the first objective revealed the resiliency of MO towards the macroeconomic conditions in Malaysia that further informs changes in inflation (INF) and log of agriculture gross domestic product (AGDP) share tend to have significant negative and positive effects (non-resilient) on the BDR. Meanwhile, household income (MHI) and AGDP share have a significant positive effect on the DPTH. Next, the findings of the second objective revealed that BDR (average borrowing per microcredit office, agriculture sector, and female borrowers) and macroeconomic condition (GDP, MHI and INF) have a significant effect on the B40HC. The findings of the third objective illustrated that selected BDR (female borrowers, borrowing per microcredit office, and age category) and DPTH (manufacturing sector) have a significant effect on the microcredit quality. More importantly, the main findings are expected to address the newly identified risk factors and strategies that can improve microcredit performance. Besides that, it is crucial for the policy implications to be relevant to the government, MOs, and borrowers. On that note, the government can make an important contribution to the borrowers by maintaining the macroeconomic stability (MHI, INF, and AGDP share) through appropriate policies that will eventually help to achieve a good microcredit coverage. Moreover, the MOs can contribute to the reduction of B40HC by decreasing the borrowing per microcredit office, increasing the number of female borrowers and number of loan in the agriculture sector. The findings also suggest that the government is able to reduce the B40HC by maintaining macroeconomic stability through GDP, MHI and INF. MOs can improve their good microcredit quality by reducing the number of loan per microcredit office, and at the same time increase the number of female borrowers, older borrowers and budget allocation of manufacturing sector respectively. Hence, it is important for the government and MO to develop a sound policy framework (risk weighing loan disbursement) as well as revisit the quality regulation (MOs) for the purpose of encouraging a competitive micro-industry and entrepreneur (coverage), B40HC, and good microcredit quality rather than simply providing financial assistance. Overall, all of these methods are believed to be helpful for the overall development of microcredit performances (government, MOs, and creditworthy borrowers). Finally, the present study managed to obtain a specific understanding that helps to achieve the objectives of governments and MOs.,Ph.D.
Pages:	176
Call Number:	HG178.3T485 2019 tesis
Publisher:	UKM, Bangi
Appears in Collections:	Faculty of Economy and Management / Fakulti Ekonomi dan Pengurusan

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