Determinants of repayment performance in microfinance programs in Malaysia: The case of Tekun Nasional programs

The objective of this study is to assess the potential factors influencing micro entrepreneur’s repayment performance in microfinance programs in Malaysia by developing a model of repayment performance. The study chooses TEKUN Nasional (TN) microfinance programs as a case study. The research framewo...

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Main Author:	Norhaziah, Nawai
Format:	Thesis
Language:	eng eng
Published:	2014
Subjects:	HG Finance
Online Access:	https://etd.uum.edu.my/4905/1/s91890.pdf https://etd.uum.edu.my/4905/2/s91890_abstract.pdf
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id	my-uum-etd.4905
record_format	uketd_dc
institution	Universiti Utara Malaysia
collection	UUM ETD
language	eng eng
advisor	Mohd Shariff, Mohd Noor
topic	HG Finance
spellingShingle	HG Finance Norhaziah, Nawai Determinants of repayment performance in microfinance programs in Malaysia: The case of Tekun Nasional programs
description	The objective of this study is to assess the potential factors influencing micro entrepreneur’s repayment performance in microfinance programs in Malaysia by developing a model of repayment performance. The study chooses TEKUN Nasional (TN) microfinance programs as a case study. The research framework of this study is built by four factors namely individual/borrower factors, firm/business factors, loan factors and institutional/lender factors. The study used mixed methodology, combining between quantitative and qualitative data through survey questionnaire and in depth interviews. However, the main study is based on quantitative data and supported by qualitative data. The analysis began with a descriptive exploration, followed by multinomial logit regression analysis and content analysis. Data were collected using multi stage random sampling in Peninsular Malaysia. 401 microentrepeneurs were selected as a sample for quantitative data and 21 microentrepreneurs and 6 TN State managers were selected for qualitative data. The results show that in terms of individual/borrower characteristics, only micro entrepreneur’s religious education level is statistically significant in the relationship between delinquent and good borrowers and between default and good borrowers. Whereas, in firm/business characteristics, the result shows that distance, business formality and total sales are statistically significant. The finding shows that total loan received, loan type and repayment schedule are the loan characteristics that affect micro entrepreneur’s loan repayment. In terms of institutional/lender characteristics, the finding shows that loan monitoring is statistically significant in the relationship between delinquent and good borrowers. This study contributes significantly to the knowledge of microfinance program at large, wherein it explains that repayment performance plays an important role to ensure that MFIs can continue providing microfinance to the micro entrepreneurs without depending on subsidies
format	Thesis
qualification_name	Ph.D.
qualification_level	Doctorate
author	Norhaziah, Nawai
author_facet	Norhaziah, Nawai
author_sort	Norhaziah, Nawai
title	Determinants of repayment performance in microfinance programs in Malaysia: The case of Tekun Nasional programs
title_short	Determinants of repayment performance in microfinance programs in Malaysia: The case of Tekun Nasional programs
title_full	Determinants of repayment performance in microfinance programs in Malaysia: The case of Tekun Nasional programs
title_fullStr	Determinants of repayment performance in microfinance programs in Malaysia: The case of Tekun Nasional programs
title_full_unstemmed	Determinants of repayment performance in microfinance programs in Malaysia: The case of Tekun Nasional programs
title_sort	determinants of repayment performance in microfinance programs in malaysia: the case of tekun nasional programs
granting_institution	Universiti Utara Malaysia
granting_department	Othman Yeop Abdullah Graduate School of Business
publishDate	2014
url	https://etd.uum.edu.my/4905/1/s91890.pdf https://etd.uum.edu.my/4905/2/s91890_abstract.pdf
_version_	1747827825523556352
spelling	my-uum-etd.49052016-04-17T06:49:03Z Determinants of repayment performance in microfinance programs in Malaysia: The case of Tekun Nasional programs 2014 Norhaziah, Nawai Mohd Shariff, Mohd Noor Othman Yeop Abdullah Graduate School of Business Othman Yeop Abdullah Graduate School of Business HG Finance The objective of this study is to assess the potential factors influencing micro entrepreneur’s repayment performance in microfinance programs in Malaysia by developing a model of repayment performance. The study chooses TEKUN Nasional (TN) microfinance programs as a case study. The research framework of this study is built by four factors namely individual/borrower factors, firm/business factors, loan factors and institutional/lender factors. The study used mixed methodology, combining between quantitative and qualitative data through survey questionnaire and in depth interviews. However, the main study is based on quantitative data and supported by qualitative data. The analysis began with a descriptive exploration, followed by multinomial logit regression analysis and content analysis. Data were collected using multi stage random sampling in Peninsular Malaysia. 401 microentrepeneurs were selected as a sample for quantitative data and 21 microentrepreneurs and 6 TN State managers were selected for qualitative data. The results show that in terms of individual/borrower characteristics, only micro entrepreneur’s religious education level is statistically significant in the relationship between delinquent and good borrowers and between default and good borrowers. Whereas, in firm/business characteristics, the result shows that distance, business formality and total sales are statistically significant. The finding shows that total loan received, loan type and repayment schedule are the loan characteristics that affect micro entrepreneur’s loan repayment. In terms of institutional/lender characteristics, the finding shows that loan monitoring is statistically significant in the relationship between delinquent and good borrowers. This study contributes significantly to the knowledge of microfinance program at large, wherein it explains that repayment performance plays an important role to ensure that MFIs can continue providing microfinance to the micro entrepreneurs without depending on subsidies 2014 Thesis https://etd.uum.edu.my/4905/ https://etd.uum.edu.my/4905/1/s91890.pdf text eng validuser https://etd.uum.edu.my/4905/2/s91890_abstract.pdf text eng public Ph.D. doctoral Universiti Utara Malaysia Adams, D.W., Graham, D., & Von Pischke, J. D. (1984). Undermining rural development with cheap credit. Boulder, Colorado: Westview Press. Addisu, M. (2006). Micro-finance repayment problems in the informal sector in Addis Ababa. Ethiopian Journal of Business & Development, 1(2), 29-50. Adekunle, B. (2007). 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