Islamic-Based Microfinance And Poverty Alleviation: Case Study Of Home-Based Women Workers In Pakistan
Loading...
Date
2014-07
Authors
Hassan, Syed Salman
Journal Title
Journal ISSN
Volume Title
Publisher
Universiti Sains Malaysia
Abstract
Poverty is one of the major problems of all developing countries, including Pakistan and,
globally, microfinance has proven to be an effective tool for poverty alleviation. In
Pakistan in 2007, almost 90% of total labour force belongs to informal economy and out
of which 70% are home-based women workers, living in absolute poverty. Despite of
their contribution in the economy, they remain invisible, vulnerable to socio-cultural
restrictions and discriminations, which make it difficult for them to access financial
resources. The present study explores the impact of Islamic-based microfinance on
poverty in home-based women workers. Efforts were also made to analyse their
potential for establishing microenterprises and to provide arguments for the
effectiveness of Islamic-based microfinance as a better intervention for poverty
alleviation among home-based women workers than the conventional microfinance. The
dualistic-development theory guides and underpins the study. By combining this theory
with the conceptual framework of the study, the issues of home-based women workers
are viewed from holistic perspective. The case study method of qualitative research was
used in the present study and primary data was gathered from home-based women
workers, located in different areas of Lahore and Rawalpindi, Pakistan, who have
availed microfinance from Akhuwat and Islamic Relief Pakistan (Islamic-based interest
free microfinance institutions). The study found that after availing the provision of
Islamic-based interest free microfinance, there was a significant positive change and
betterment in the household circumstances of home-based women workers. Their
indigenous mode of acquiring the skills, willingness to enhance their economic activity,
living in the urban areas and desire to come out of the poverty reflects their potential for
developing microenterprises. The research study concludes that Islamic-based interest
free microfinance is a better intervention than conventional interest based microfinance
in case of women home-based workers. For poverty alleviation, the government should
support Islamic microfinance program, based on inclusive financial system, as it is selfsustainable,
effective and in accordance with the religious beliefs of the home-based
women workers.
Description
Keywords
Islamic-based microfinance , poverty alleviation