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Effectiveness of Islamic Microfinance in Alleviating Poverty: Empirical Evidence from Bangladesh

Author

Listed:
  • Md. Nur Nobi

    (Faculty of Finance and Administrative Sciences, Al-Madinah International University, Malaysia)

  • Md. Arif Billah

    (Assistant Professor of Economics, Department of Qur’anic Sciences, International Islamic University Chittagong, Bangladesh)

  • Asaduzzaman Shohel

    (International Islamic University Chittagong, Bangladesh)

  • Tani

    (Department of Public Administration, Jagannath University, Bangladesh.)

Abstract

Islamic Micro - finance (IMFc) is an evolving technique to empower the deprived and needy population. The present study was intended to investigate the effect of the IMFc on the resources of individuals borrowing from an Islamic microfinance institution and their poverty status. The prime intention of this paper is to justify the effect of IFMc for poverty alleviation. The study reveals that IMFc programs have introduced a positive result on significant numbers of poor. Islamic microfinance has significant impacts on income, savings and expenditure levels of the household. The analysis shows that in general, the Islamic micro finance is an instrument that can help to accumulate savings and income and finally assist to alleviate their poverty. But still it is not only the instrument that can alleviate poverty but it is the vital component that can help to the poor people for standard living levels. Our analysis shows that after taking Islamic finance there is a significant change in the respondents’ income savings and expenditures.

Suggested Citation

  • Md. Nur Nobi & Md. Arif Billah & Asaduzzaman Shohel & Tani, 2021. "Effectiveness of Islamic Microfinance in Alleviating Poverty: Empirical Evidence from Bangladesh," International Journal of Science and Business, IJSAB International, vol. 5(4), pages 1-10.
    • Handle: RePEc:aif:journl:v:5:y:2021:i:4:p:1-10
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    References listed on IDEAS

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    1. Sharma, Manohar & Zeller, Manfred, 1999. "Placement and Outreach of Group-Based Credit Organizations: The Cases of ASA, BRAC, and PROSHIKA in Bangladesh," World Development, Elsevier, vol. 27(12), pages 2123-2136, December.
    2. Rahman, Aminur, 1999. "Micro-credit initiatives for equitable and sustainable development: Who pays?," World Development, Elsevier, vol. 27(1), pages 67-82, January.
    3. Md. Nur Nobi & Md. Lutfur Rahman Al Azhari & Shahedul Islam & Md. Arif Billah, 2020. "Comparative Financial Position Analysis of Islamic Banking Industries: A Study of Selected Islamic Banks in Bangladesh," International Journal of Science and Business, IJSAB International, vol. 4(11), pages 119-130.
    4. Mark M. Pitt & Shahidur R. Khandker, 1998. "The Impact of Group-Based Credit Programs on Poor Households in Bangladesh: Does the Gender of Participants Matter?," Journal of Political Economy, University of Chicago Press, vol. 106(5), pages 958-996, October.
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