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POVERTY REDUCTION STRATEGIES: EVIDENCE FROM U-MICROFINANCE BANK
Corresponding Author(s) : Iram Rani
Humanities & Social Sciences Reviews,
Vol. 9 No. 1 (2021): January
Abstract
Purpose: This Study intends the assessment of microloan by U Microfinance Bank from females of upper Sindh. The core objective was to assess the impact of U-Microfinance on the poverty level of female for improving their living standards by providing them micro-loans to be used for their small-scale business which could enable them to be empowered politically, socially, economically, and assessing its impacts on the health and education of their families.
Methodology: This study was conducted on the assessment of microloan interventions of U Microfinance Bank in the rural areas of upper Sindh. A quantitative approach was used to measure the impact of microloan on the poverty status of the female along with a qualitative study to further confirm the findings. In this study, a quasi-experimental design was used in which two groups of data from the same respondents assuming the data ‘Before-loan and After-Loan Situation’ from the female borrowers of Khairpur, Sukkur, Shikarpur, Larkana, and Dadu Districts of Upper Sindh. Poverty Score Card was used as a survey instrument originally developed by the World Bank for each region separately. The collected data were analyzed by applying the descriptive statistics and logistic regression technique by using SPSS latest version.
Results: Results of the logistic regression analysis demonstrate that the microloan program does empower females of targeted cities, but the empowerment process does not necessarily occur simultaneously across all dimensions. Whereas microfinance does effect individually on each dimension of empowerment. For microfinance ventures, the results suggest that occupation types have a positive impact on women's empowerment.
Applications of this study: This study can be very effective in improving the strategies for poverty reduction among the female borrowers of the upper Sindh.
The Novelty of the study: The novelty of this study investigating the effect of poverty reduction strategies on female empowerment.
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- Admin Ibex. (2014) An overview of microfinance Sector of Pakistan. Retrieved from http://www.ibexmag.com/business/overview-micro-finance-sector-pakistan/
- Agbola, F. W., Acupan, A., & Mahmood, A. (2017). Does microfinance reduce poverty? New evidence from Northeastern Mindanao, the Philippines. Journal of Rural Studies, 50, 159-171. https://doi.org/10.1016/j.jrurstud.2016.11.005 DOI: https://doi.org/10.1016/j.jrurstud.2016.11.005
- Akhtar, R., Liu, H., & Ali, A. (2017). Influencing factors of poverty in Pakistan: Time series analysis. International Journal of Economics and Financial Issues, 7(2), 215.
- Ali, A., &Alam, M.A., (2010). Role and Performance of Micro-credit in Pakistan. International Journal of Business, 1-43.
- Al-shami, S. S. A., Razali, R. M., & Rashid, N. (2018). The effect of microcredit on women empowerment in welfare and decisions making in Malaysia. Social Indicators Research, 137(3), 1073-1090. https://doi.org/10.1007/s11205-017-1632-2 DOI: https://doi.org/10.1007/s11205-017-1632-2
- Arora, S. (2011). Meenu, Women empowerment through microfinance intervention in the commercial banks: An empirical study in the rural India with special reference to the state of Punjab. Int. J. Eco. Res, 2(2), 35-45.
- Asad K. Ghalib, Issam Malki, Katsushi S. Imai. (2015). Microfinance and Household Poverty Reduction: Empirical Evidence from Rural Pakistan. Oxford Development Studies 43:1 pages 84-104. https://doi.org/10.1080/13600818.2014.980228 DOI: https://doi.org/10.1080/13600818.2014.980228
- Bakhtiari, S. (2006). Micro-finance and Poverty Reduction (Some International Evidence). International Business & Economics Research Journal, 1-7.
- Bateman, M., & Chang, H. J. (2012). Microfinance and the illusion of development: From hubris to nemesis in thirty years. World Economic Review, (1).
- Chandarsekar, K.S., & Prakash, C.S.S. (2010). The role of information communication technology in females empowerment and poverty eradication in Kerala. APJRBM, 1(2): pages 281-292.
- Civil Society Coalition on Sustainable Development (CSCSD),(2019). Gender Equality And Women's Empowerment,www.cscsd.org
- Dr Kamal Monnoo. (2017). Is microfinance succeeding in Pakistan?. Retrieved from https://nation.com.pk/09-Aug-2017/is-microfinance-succeeding-in-pakistan
- Durrani, M. K. K., Usman, A., Malik, M. I., & Shafiq, A. (2011). Role of microfinance in reducing poverty: A look at social and economic factors. International Journal of Business and social science, 2(21).http://ubank.com.pk/http://ubank.com.pk/downloads/
- Gine, X., & Klonner, S. (2005). Credit Constraints as a Barrier to Technology Adoption by the Poor: Lessons from South-Indian Small-Scale Fishery. World Bank Policy Research Working Paper 3665. https://doi.org/10.1596/1813-9450-3665 DOI: https://doi.org/10.1596/1813-9450-3665
- Hameed, W., Azmat, S. K., Ali, M., Sheikh, M. I., Abbas, G., Temmerman, M., & Avan, B. I. (2014). Women's empowerment and contraceptive use: the role of independent versus couples' decision-making, from a lower middle income country perspective. PloS one, 9(8), e104633, 1-9. https://doi.org/10.1371/journal.pone.0104633 DOI: https://doi.org/10.1371/journal.pone.0104633
- Honohan, P. (2008). Cross-country variation in household access to financial services. Journal of Banking & Finance, 32(11),2493-2500. https://doi.org/10.1016/j.jbankfin.2008.05.004 DOI: https://doi.org/10.1016/j.jbankfin.2008.05.004
- Hussein, M., & Hussain, S. (2003). The impact of microfinance on poverty and gender equity: Approaches and evidence from Pakistan. Islamabad: Pakistan Microfinance Network https://www.findevgateway.org/sites/default/files/publications/files/mfg-en-paper-the-impact-of-micro-finance-on-poverty-and-gender-equity-approaches-and-evidence-from-pakistan-dec-2003.pdf
- Imai, K. S., & Azam, M. S. (2012). Does microfinance reduce poverty in Bangladesh? New evidence from household panel data. Journal of Development studies, 48(5), 633-653. https://doi.org/10.1080/00220388.2012.661853 DOI: https://doi.org/10.1080/00220388.2012.661853
- Kabungaidze, T., Mahlatshana, N., & Ngirande, H. (2013). The impact of job satisfaction and some demographic variables on employee turnover intentions. International Journal of Business Administration, 4(1), 53-65. https://doi.org/10.5430/ijba.v4n1p53 DOI: https://doi.org/10.5430/ijba.v4n1p53
- Kasali, T. A., Ahmad, S. A., & Lim, H. E. (2015). The role of microfinance in poverty alleviation: Empirical evidence from South-West Nigeria. Asian Social Science, 11(21), 183-192. https://doi.org/10.5539/ass.v11n21p183 DOI: https://doi.org/10.5539/ass.v11n21p183
- Kamran R, Humaira Y. (2019). Role of Microfinance Banks in Provision of Credit for Poverty Reduction in Pakistan. Handbook of Research on Rural Sociology and Community Mobilization for Sustainable Growth pages 132-145. https://doi.org/10.4018/978-1-5225-7158-2.ch008 DOI: https://doi.org/10.4018/978-1-5225-7158-2.ch008
- Mahmood, H., & Chaudhary, A. R. (2009). Application of endogenous growth model to the economy of Pakistan: A cointegration approach. Pakistan Journal of Commerce and Social Sciences (PJCSS), 2, 16-24.
- Mayoux, L. (2001a). Impact Assessment of Micro – Finance: Towards a Sustainable Learning Process. Paper Produced from the DFID Enterprise Development Impact Assessment Information Service (EDIAIS) website: www.enterprise-impact@org.uk
- Montgomery, H., & Weiss, J. (2011). Can commercially-oriented microfinance help meet the millennium development goals? Evidence from Pakistan. World Development, 39(1), 87-109. https://doi.org/10.1016/j.worlddev.2010.09.001 DOI: https://doi.org/10.1016/j.worlddev.2010.09.001
- Muhammad-Bashir Owolabi Y, Nasim Shah S, Gairuzazmi Mat G. (2016). An empirical analysis of factors that determine poverty among the beneficiaries of Pakistan Poverty Alleviation Fund. Journal of Enterprising Communities: People and Places in the Global Economy 10:3, pages 306-320. https://doi.org/10.1108/JEC-10-2014-0023 DOI: https://doi.org/10.1108/JEC-10-2014-0023
- Nader, Y. F. (2008). Microcredit and the socio-economic wellbeing of women and their families in Cairo. The Journal of Socio-Economics, 37(2), 644-656. https://doi.org/10.1016/j.socec.2007.10.008 DOI: https://doi.org/10.1016/j.socec.2007.10.008
- Naser, M. A., & Crowther, D. (2016). Microfinance and Women Empowerment Corporate Responsibility and Stakeholding (pp. 49-65): Emerald Group Publishing Limited. https://doi.org/10.1108/S2043-052320160000010004 DOI: https://doi.org/10.1108/S2043-052320160000010004
- Rashid, T., & Makuwira, J. (2014). Global financial crisis and women's micro-lending innovations in Pakistan and Malawi. Development in Practice, 24(1), 39-50. https://doi.org/10.1080/09614524.2014.867927 DOI: https://doi.org/10.1080/09614524.2014.867927
- Rauf, S. A., & Mahmood, T. (2009). Growth and performance of microfinance in Pakistan. Pakistan economic and social review, 99-122.
- SaadIbrar. (2013, April 15) Performance of microfinance sector in Pakistan. Retrieved from https://nation.com.pk/15-Apr-2013/performance-of-microfinance-sector-in-pakistan
- Sandelowski, M. (2000). Combining qualitative and quantitative sampling, data collection, and analysis techniques in mixedâ€method studies. Research in nursing & health, 23(3), 246-255. https://doi.org/10.1002/1098-240X(200006)23:3<246::AID-NUR9>3.0.CO;2-H DOI: https://doi.org/10.1002/1098-240X(200006)23:3<246::AID-NUR9>3.0.CO;2-H
- Sayvaya, I. and Kyophilavong, P. (2015). Does microfinance reduce poverty in Lao PDR? International Journal of Development Issues, Vol. 14 No. 3, pp. 215-230. https://doi.org/10.1108/IJDI-10-2014-0072 DOI: https://doi.org/10.1108/IJDI-10-2014-0072
- Sekaran, U., & Bougie, R. (2010). Research Methods for Business: A Skill Building Approach. Chichester, West Sussex: John Willey & Sons.
- Shirazi, N. S. (2012). Targeting and socio-economic impact of microfinance: A case study of Pakistan. Islamic Economic Studies, 130(608), 1-56.
- Shirazi, Shah. N, (2008). Return on Investment in Microenterprises: Experience of the Borrowers of Pakistan Poverty Alleviation Fund. Forman Journal of Economic Studies, Vol 4, January-December, pp. 27-40.
- Shirazi, Shah. N, and Khan.AU, (2009). Role of Pakistan Poverty Alleviation Fund in Poverty Alleviation: A case of Pakistan. Pakistan Economic and Social Review Vol. 47, No. 2 pp. 215-228.
- Tahir, M. and Azid, T. (2015). The relationship between international trade openness and economic growth in the developing economies: Some new dimensions. Journal of Chinese Economic and Foreign Trade Studies, Vol. 8 No. 2, pp. 123-139. https://doi.org/10.1108/JCEFTS-02-2015-0004 DOI: https://doi.org/10.1108/JCEFTS-02-2015-0004
- UNFPA (2014). Guidelines On Women's Empowerment For The UN Resident Coordinator System. www@undp.org
- ur Rahman, S., Chaudhry, I. S., & Farooq, F. (2018). Gender inequality in education and household poverty in Pakistan: A Case of Multan District. Review of Economics and Development Studies, 4(1), 115-126. https://doi.org/10.26710/reads.v4i1.286 DOI: https://doi.org/10.26710/reads.v4i1.286
- Rooyen, C., Stewart, R., & De Wet, T. (2012). The impact of microfinance in sub-Saharan Africa: a systematic review of the evidence. World Development, 40(11), 2249-2262. https://doi.org/10.1016/j.worlddev.2012.03.012 DOI: https://doi.org/10.1016/j.worlddev.2012.03.012
- Van Teijlingen, E. R., & Hundley, V. (2001). The importance of pilot studies. Social Research Update, (35). http://sru.soc.surrey.ac.uk/SRU35.html
- World Bank. (2007). Social Protection in Pakistan: Managing Household Risks and Vulnerability. South Asia Report No. 35472-PK.
- Xiang, Xiangping, J., Jikun H. (2014). Microfinance through non-governmental organizations and its effects on formal and informal credit: Evidence from rural China. China Agricultural Economic Review, Emerald Group Publishing, vol. 6(2), pages 182-197, April. https://doi.org/10.1108/CAER-04-2013-0062 DOI: https://doi.org/10.1108/CAER-04-2013-0062
References
Admin Ibex. (2014) An overview of microfinance Sector of Pakistan. Retrieved from http://www.ibexmag.com/business/overview-micro-finance-sector-pakistan/
Agbola, F. W., Acupan, A., & Mahmood, A. (2017). Does microfinance reduce poverty? New evidence from Northeastern Mindanao, the Philippines. Journal of Rural Studies, 50, 159-171. https://doi.org/10.1016/j.jrurstud.2016.11.005 DOI: https://doi.org/10.1016/j.jrurstud.2016.11.005
Akhtar, R., Liu, H., & Ali, A. (2017). Influencing factors of poverty in Pakistan: Time series analysis. International Journal of Economics and Financial Issues, 7(2), 215.
Ali, A., &Alam, M.A., (2010). Role and Performance of Micro-credit in Pakistan. International Journal of Business, 1-43.
Al-shami, S. S. A., Razali, R. M., & Rashid, N. (2018). The effect of microcredit on women empowerment in welfare and decisions making in Malaysia. Social Indicators Research, 137(3), 1073-1090. https://doi.org/10.1007/s11205-017-1632-2 DOI: https://doi.org/10.1007/s11205-017-1632-2
Arora, S. (2011). Meenu, Women empowerment through microfinance intervention in the commercial banks: An empirical study in the rural India with special reference to the state of Punjab. Int. J. Eco. Res, 2(2), 35-45.
Asad K. Ghalib, Issam Malki, Katsushi S. Imai. (2015). Microfinance and Household Poverty Reduction: Empirical Evidence from Rural Pakistan. Oxford Development Studies 43:1 pages 84-104. https://doi.org/10.1080/13600818.2014.980228 DOI: https://doi.org/10.1080/13600818.2014.980228
Bakhtiari, S. (2006). Micro-finance and Poverty Reduction (Some International Evidence). International Business & Economics Research Journal, 1-7.
Bateman, M., & Chang, H. J. (2012). Microfinance and the illusion of development: From hubris to nemesis in thirty years. World Economic Review, (1).
Chandarsekar, K.S., & Prakash, C.S.S. (2010). The role of information communication technology in females empowerment and poverty eradication in Kerala. APJRBM, 1(2): pages 281-292.
Civil Society Coalition on Sustainable Development (CSCSD),(2019). Gender Equality And Women's Empowerment,www.cscsd.org
Dr Kamal Monnoo. (2017). Is microfinance succeeding in Pakistan?. Retrieved from https://nation.com.pk/09-Aug-2017/is-microfinance-succeeding-in-pakistan
Durrani, M. K. K., Usman, A., Malik, M. I., & Shafiq, A. (2011). Role of microfinance in reducing poverty: A look at social and economic factors. International Journal of Business and social science, 2(21).http://ubank.com.pk/http://ubank.com.pk/downloads/
Gine, X., & Klonner, S. (2005). Credit Constraints as a Barrier to Technology Adoption by the Poor: Lessons from South-Indian Small-Scale Fishery. World Bank Policy Research Working Paper 3665. https://doi.org/10.1596/1813-9450-3665 DOI: https://doi.org/10.1596/1813-9450-3665
Hameed, W., Azmat, S. K., Ali, M., Sheikh, M. I., Abbas, G., Temmerman, M., & Avan, B. I. (2014). Women's empowerment and contraceptive use: the role of independent versus couples' decision-making, from a lower middle income country perspective. PloS one, 9(8), e104633, 1-9. https://doi.org/10.1371/journal.pone.0104633 DOI: https://doi.org/10.1371/journal.pone.0104633
Honohan, P. (2008). Cross-country variation in household access to financial services. Journal of Banking & Finance, 32(11),2493-2500. https://doi.org/10.1016/j.jbankfin.2008.05.004 DOI: https://doi.org/10.1016/j.jbankfin.2008.05.004
Hussein, M., & Hussain, S. (2003). The impact of microfinance on poverty and gender equity: Approaches and evidence from Pakistan. Islamabad: Pakistan Microfinance Network https://www.findevgateway.org/sites/default/files/publications/files/mfg-en-paper-the-impact-of-micro-finance-on-poverty-and-gender-equity-approaches-and-evidence-from-pakistan-dec-2003.pdf
Imai, K. S., & Azam, M. S. (2012). Does microfinance reduce poverty in Bangladesh? New evidence from household panel data. Journal of Development studies, 48(5), 633-653. https://doi.org/10.1080/00220388.2012.661853 DOI: https://doi.org/10.1080/00220388.2012.661853
Kabungaidze, T., Mahlatshana, N., & Ngirande, H. (2013). The impact of job satisfaction and some demographic variables on employee turnover intentions. International Journal of Business Administration, 4(1), 53-65. https://doi.org/10.5430/ijba.v4n1p53 DOI: https://doi.org/10.5430/ijba.v4n1p53
Kasali, T. A., Ahmad, S. A., & Lim, H. E. (2015). The role of microfinance in poverty alleviation: Empirical evidence from South-West Nigeria. Asian Social Science, 11(21), 183-192. https://doi.org/10.5539/ass.v11n21p183 DOI: https://doi.org/10.5539/ass.v11n21p183
Kamran R, Humaira Y. (2019). Role of Microfinance Banks in Provision of Credit for Poverty Reduction in Pakistan. Handbook of Research on Rural Sociology and Community Mobilization for Sustainable Growth pages 132-145. https://doi.org/10.4018/978-1-5225-7158-2.ch008 DOI: https://doi.org/10.4018/978-1-5225-7158-2.ch008
Mahmood, H., & Chaudhary, A. R. (2009). Application of endogenous growth model to the economy of Pakistan: A cointegration approach. Pakistan Journal of Commerce and Social Sciences (PJCSS), 2, 16-24.
Mayoux, L. (2001a). Impact Assessment of Micro – Finance: Towards a Sustainable Learning Process. Paper Produced from the DFID Enterprise Development Impact Assessment Information Service (EDIAIS) website: www.enterprise-impact@org.uk
Montgomery, H., & Weiss, J. (2011). Can commercially-oriented microfinance help meet the millennium development goals? Evidence from Pakistan. World Development, 39(1), 87-109. https://doi.org/10.1016/j.worlddev.2010.09.001 DOI: https://doi.org/10.1016/j.worlddev.2010.09.001
Muhammad-Bashir Owolabi Y, Nasim Shah S, Gairuzazmi Mat G. (2016). An empirical analysis of factors that determine poverty among the beneficiaries of Pakistan Poverty Alleviation Fund. Journal of Enterprising Communities: People and Places in the Global Economy 10:3, pages 306-320. https://doi.org/10.1108/JEC-10-2014-0023 DOI: https://doi.org/10.1108/JEC-10-2014-0023
Nader, Y. F. (2008). Microcredit and the socio-economic wellbeing of women and their families in Cairo. The Journal of Socio-Economics, 37(2), 644-656. https://doi.org/10.1016/j.socec.2007.10.008 DOI: https://doi.org/10.1016/j.socec.2007.10.008
Naser, M. A., & Crowther, D. (2016). Microfinance and Women Empowerment Corporate Responsibility and Stakeholding (pp. 49-65): Emerald Group Publishing Limited. https://doi.org/10.1108/S2043-052320160000010004 DOI: https://doi.org/10.1108/S2043-052320160000010004
Rashid, T., & Makuwira, J. (2014). Global financial crisis and women's micro-lending innovations in Pakistan and Malawi. Development in Practice, 24(1), 39-50. https://doi.org/10.1080/09614524.2014.867927 DOI: https://doi.org/10.1080/09614524.2014.867927
Rauf, S. A., & Mahmood, T. (2009). Growth and performance of microfinance in Pakistan. Pakistan economic and social review, 99-122.
SaadIbrar. (2013, April 15) Performance of microfinance sector in Pakistan. Retrieved from https://nation.com.pk/15-Apr-2013/performance-of-microfinance-sector-in-pakistan
Sandelowski, M. (2000). Combining qualitative and quantitative sampling, data collection, and analysis techniques in mixedâ€method studies. Research in nursing & health, 23(3), 246-255. https://doi.org/10.1002/1098-240X(200006)23:3<246::AID-NUR9>3.0.CO;2-H DOI: https://doi.org/10.1002/1098-240X(200006)23:3<246::AID-NUR9>3.0.CO;2-H
Sayvaya, I. and Kyophilavong, P. (2015). Does microfinance reduce poverty in Lao PDR? International Journal of Development Issues, Vol. 14 No. 3, pp. 215-230. https://doi.org/10.1108/IJDI-10-2014-0072 DOI: https://doi.org/10.1108/IJDI-10-2014-0072
Sekaran, U., & Bougie, R. (2010). Research Methods for Business: A Skill Building Approach. Chichester, West Sussex: John Willey & Sons.
Shirazi, N. S. (2012). Targeting and socio-economic impact of microfinance: A case study of Pakistan. Islamic Economic Studies, 130(608), 1-56.
Shirazi, Shah. N, (2008). Return on Investment in Microenterprises: Experience of the Borrowers of Pakistan Poverty Alleviation Fund. Forman Journal of Economic Studies, Vol 4, January-December, pp. 27-40.
Shirazi, Shah. N, and Khan.AU, (2009). Role of Pakistan Poverty Alleviation Fund in Poverty Alleviation: A case of Pakistan. Pakistan Economic and Social Review Vol. 47, No. 2 pp. 215-228.
Tahir, M. and Azid, T. (2015). The relationship between international trade openness and economic growth in the developing economies: Some new dimensions. Journal of Chinese Economic and Foreign Trade Studies, Vol. 8 No. 2, pp. 123-139. https://doi.org/10.1108/JCEFTS-02-2015-0004 DOI: https://doi.org/10.1108/JCEFTS-02-2015-0004
UNFPA (2014). Guidelines On Women's Empowerment For The UN Resident Coordinator System. www@undp.org
ur Rahman, S., Chaudhry, I. S., & Farooq, F. (2018). Gender inequality in education and household poverty in Pakistan: A Case of Multan District. Review of Economics and Development Studies, 4(1), 115-126. https://doi.org/10.26710/reads.v4i1.286 DOI: https://doi.org/10.26710/reads.v4i1.286
Rooyen, C., Stewart, R., & De Wet, T. (2012). The impact of microfinance in sub-Saharan Africa: a systematic review of the evidence. World Development, 40(11), 2249-2262. https://doi.org/10.1016/j.worlddev.2012.03.012 DOI: https://doi.org/10.1016/j.worlddev.2012.03.012
Van Teijlingen, E. R., & Hundley, V. (2001). The importance of pilot studies. Social Research Update, (35). http://sru.soc.surrey.ac.uk/SRU35.html
World Bank. (2007). Social Protection in Pakistan: Managing Household Risks and Vulnerability. South Asia Report No. 35472-PK.
Xiang, Xiangping, J., Jikun H. (2014). Microfinance through non-governmental organizations and its effects on formal and informal credit: Evidence from rural China. China Agricultural Economic Review, Emerald Group Publishing, vol. 6(2), pages 182-197, April. https://doi.org/10.1108/CAER-04-2013-0062 DOI: https://doi.org/10.1108/CAER-04-2013-0062