The Role of Islamic Microfinance For Poverty Alleviation in Bandung, Indonesia

Authors

  • Irawan Febianto Universitas Padjadjaran
  • Fuadah Binti Johari Islamic Science University of Malaysia
  • Zurina Binti Kefeli @Zulkefli Islamic Science University of Malaysia

DOI:

https://doi.org/10.12928/ijiefb.v2i1.736

Keywords:

Islamic microfinance, poverty alleviation, micro-entrepreneur

Abstract

The emergence of Islamic micro financial institution becomes the alternative solution for the micro-entrepreneurs who need working capital assistance. However, the impact of Islamic microfinance institution in reducing poverty level is somewhat still debatable. In Indonesia, Islamic microfinance established through the presence of Baitul Mal wa Tamwil (BMT), the most popular type of Islamic microfinance institutions. BMT providing financing for the micro-entrepreneurs, as their potential clients, that operates their activities mostly at the traditional markets. The purpose of this study is to measure the impact of BMT for poverty alleviation in Bandung as the capital city of West Java as the biggest population province in Indonesia, not only based on material level but also on spiritual level. This study is looking at income variables of micro-entrepreneur’s household, as well as the spiritual level indicator of micro-entrepreneur before and after they received financing from BMT. The primary data obtained through in-depth questionnaires in Bandung, Indonesia.

Author Biography

Irawan Febianto, Universitas Padjadjaran

Lecturer & Researcher in Islamic Economics and Finance

References

Journals, Bulletin, and Scientific Magazine
[1] Badan Pusat Statistik, 2019. Berita Resmi Statistik Provinsi Jawa Barat Januari 2019.
[2] Beik, Irfan Syauqi and Laily D.A. 2015. ‘Construction of CIBEST Model as Measurement of Poverty and Welfare Indices From Islamic Perspective’. Al-Iqtishad, Vol. VII No. 1, pp. 87-104.
[3] Durrani, M.K.K., Usman, A., Muhammad Imran Malik, M.I., & Ahmad, S. (2011) Role of Micro Finance in Reducing Poverty: A Look at Social and Economic Factors. International Journal of Business and Social Science. 2 (21), pp. 138-144.
[4] Khandker, S., et. all.. 1995. ‘Grameen Bank: Performance and Sustainability’. World Bank Discussion Paper 306. Washington, DC: The World Bank.
[5] Nawai, Norhaziah. 2016. ‘The Role Of Islamic Microfinancing For Poverty Alleviation: Malaysia’s Experience’. Critical Readings in Islamic Social Finance. Pp. 149-176. USIM Press. Nilai.
[6] Shirazi, N.S. & Khan, A.U. 2009. Role of Pakistan Poverty Alleviation Fund’s Micro Credit In Poverty Alleviation :A Case of Pakistan. Pakistan Economic and Social Review. 7(2), pp.215-228.
[7] SMERU.2007. Dampak Supermarket terhadap Pasar dan Pedagang Ritel Tradisional di Daerah Perkotaan di Indonesia. Vol.22-2007. The SMERU Research Institute, Indonesia.
[8] Thomson Reuters. 2017. Islamic Finance Development Report 2017.
[9] Thomson Reuters. 2014. Islamic Financial Report 2014.

Books
[10] Obaidullah, M. and Khan, T. 2008. Islamic Microfinance Development: Challengenes and Initiatives. Islamic Research and Training Institute – Islamic Development Bank. Jeddah.
[11] Obaidullah, M. 2008. Role of Microfinance in Poverty Alleviation: Lesson From Experiences in Selected IDB Member Countries. Islamic Research and Training Institute – Islamic Development Bank. Jeddah.
[12] Yunus, Muhammad. 1999. Banker To The Poor: Micro-Lending And The Battle Againts Wold Poverty. Public Affairs. United States of America.

Thesis, Dissertation
[13] Kholim, M. 2004. Eksistensi Baitul Maal Wattamwil dan Permasalahan Dalam Operasionalisasinya (Studi di Propinsi Jawa Tengah). Master Thesis Magister Ilmu Hukum Universitas Diponegoro. Semarang.

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Published

2019-06-24

Issue

Vol. 2 No. 1 (2019)

Section

Articles

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