Microfinance through pawnshops: commercial sustainability and impact evaluation

Chan, Selina Ching; Owyong, David T.

doi:10.3362/0957-1329.2007.008

Cited by 2 publications

(3 citation statements)

References 1 publication

Supporting

Mentioning

Contrasting

Order By: Relevance

“…For example, the usage of Ar-Rahnu among male entrepreneurs is insignificant in value, whereas female microentrepreneurs view Ar-Rahnu as one of the important tools in order to get access for cash instantly. According to Aziz (2006), Chan and Owyong (2007), Muhamat et al (2011), Amin (2011), Mokthar andZambahari (2012) and Murisa and Chikweche (2013), women who are active in micro businesses often resort to pawn brokers as a means to get short term capital to enhance their business. They often pledge their jewelleries early in the morning for cash to be used in their business activities during the early part of the day and redeem back at the later part of the day after receiving profit from the day's business.…”

Section: Ar-rahnumentioning

confidence: 99%

Unleashing the Ar-Rahnu as a Micro-Financing Instrument for Micro-Entrepreneurs in Malaysia

Azman¹,

Zabri²,

Kassim³

et al. 2020

IJARBSS

View full text Add to dashboard Cite

The purpose of this paper is to compare the Islamic micro-financing and Ar-Rahnu. Using the content analysis approach, the paper examines the reports of micro-financing provided by Bank Negara Malaysia and comparing the rate with Ar-Rahnu. To validate the content analysis facts and to reveal the actual behavior and perception of micro-entrepreneurs towards Ar-Rahnu, this study also conducted in-depth interview. The results show significant advantages of Ar-Rahnu as a better option as compared to the Islamic micro-financing as Ar-Rahnu has the lowest pricing charges, offer higher margin and lesser procedures required. In fact, Ar-Rahnu also have skilled employees reflected to their customer satisfaction and updated with the current technology of innovation (fintech). This paper's contribution to the literature is by including a comparison between the products within the Islamic financial system setting. Besides, in term of methodology, this study used multiple approaching techniques of qualitative method which are content analysis and in-depth interview.

show abstract

Section: Ar-rahnumentioning

confidence: 99%

Unleashing the Ar-Rahnu as a Micro-Financing Instrument for Micro-Entrepreneurs in Malaysia

Azman¹,

Zabri²,

Kassim³

et al. 2020

IJARBSS

View full text Add to dashboard Cite

show abstract

“…From the perspective of ar-rahnu , it also attempts to attract customers by offering speedy and efficient transactions. It enables a customer to have cash within minutes without having to fill out numerous application forms and enduring a long waiting period required for the approval of bank loans (Chan and Owyong, 2007).…”

Section: The Informal Credit Market Theory and Ar-rahnumentioning

confidence: 99%

“…According to Chan and Owyong (2007), the informal credit market serves the financial needs of the community directly through simplified application procedures, rapid extension of credit, focus on the local market and addressing the needs of poor clients. As stated by Plateau (1994), the informal credit market theory also stresses the issues of efficiency and resource mobilisation, which can be used for modernisation and investment purpose.…”

Section: Introductionmentioning

confidence: 99%

Analysing ar-rahnu in the context of informal credit market theory

Azman

Kassim

Adeyemi

2018

IJIF

View full text Add to dashboard Cite

Purpose This study aims to offer a new area of discourse by investigating the factors determining the usage of the Islamic non-bank financing product ar-rahnu (Islamic pawnbroking) among women micro-entrepreneurs in Malaysia within the framework of the informal credit market theory. Design/methodology/approach The study is based on primary data obtained by using self-administered questionnaires distributed in three states in Malaysia: Kedah, Kelantan and Terengganu. The questionnaires were distributed to a total of 750 participants, with each state contributing 250 respondents. Total number of respondents valid for data analysis was however 600. Findings Based on descriptive and inferential statistics by using the IBM statistical package for the social sciences and structural equation modelling analysis of moment structures, the results show that the main factor influencing women micro-entrepreneurs to use ar-rahnu is the service charge. Research limitations/implications This study only covers three states in Malaysia and is limited to examining the use of ar-rahnu by women micro-entrepreneurs in those states. Practical implications As micro-entrepreneur s often face constraints to obtaining financial access in the formal credit market, ar-rahnu provides an alternative mode of obtaining business financing to female micro-entrepreneurs, so they can sustain their operations and even expand their businesses. The significance of such factors like service fee, as revealed in this study, indicates that managers should focus on this element when offering Islamic financial products, especially to women micro-entrepreneurs. Originality/value The informal credit market theory is frequently used in conventional studies. This paper adds Sharīʿah compliance in the context of this theory as a new area to be considered when discussing Islamic financial products.

show abstract

Microfinance through pawnshops: commercial sustainability and impact evaluation

Cited by 2 publications

References 1 publication

Unleashing the Ar-Rahnu as a Micro-Financing Instrument for Micro-Entrepreneurs in Malaysia

Unleashing the Ar-Rahnu as a Micro-Financing Instrument for Micro-Entrepreneurs in Malaysia

Analysing ar-rahnu in the context of informal credit market theory

Contact Info

Product

Resources

About