scholarly journals Muḍārabah and mushārakah as micro-equity finance: perception of Selangor’s disadvantaged women entrepreneurs

2020 ◽  
Vol 12 (2) ◽  
pp. 217-237
Author(s):  
Reazul Islam ◽  
Rubi Ahmad
Keyword(s):  
Women Entrepreneurs ◽  
Structural Equation ◽  
Islamic Law ◽  
Profit Sharing ◽  
Equity Financing ◽  
Content Type ◽  
Disadvantaged Women ◽  
Poor Women ◽  
Microfinance Institution ◽  
Equity Finance

Purpose This study aims to gain the perception of Selangor’s disadvantaged women on the Sharīʿah (Islamic law) rules on two micro-equity financing instruments, namely, muḍārabah (profit sharing) and mushārakah (profit-and-loss sharing) (M&M). Design/methodology/approach A survey was carried out in the rural area of Selangor district in Malaysia by administering a self-generated structured questionnaire. A total of 330 completed questionnaires were retrieved from the members of an Islamic microfinance institution (IsMFI), namely, Amanah Ikhtiar Malaysia (AIM). The data were analysed by using structural equation modelling. Findings The female borrowers of AIM perceive the Sharīʿah rules of M&M requiring high moral and ethical values and diligent repayment performance. They are aware of some other underlying provisions such as business liquidation, share transfer, information discloser and business termination. The overall findings of this study suggest that the perceived Sharīʿah rules are akin to those that are commonly used in general partnership businesses between Muslims. It also indicates that disadvantaged entrepreneurs would accept the rules that are easy to comprehend as well as favourable to their interests. It further suggests that respondents’ experiences of microfinance and business operation do not have a significant influence on their perception of M&M instruments. Research limitations/implications This study was limited to Selangor. So, the perception of Muslim women surveyed may not represent the views of all women in Malaysia. However, it can offer a primary understanding of the said issue. Practical implications The findings of this study can help IsMIFs take initiatives to offer M&M as micro-equity finance to poor women entrepreneurs. Originality/value So far, limited studies have been carried out on M&M-based microfinancing. This paper offers new insights presenting disadvantaged women entrepreneurs’ perception of these financing instruments.

Rural women entrepreneurs in Oman: problems and opportunities

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Suhail M. Ghouse ◽  
Omar Durrah ◽  
Gerard McElwee
Keyword(s):  
Rural Women ◽  
Women Entrepreneurs ◽  
Structural Equation ◽  
Equation Modeling ◽  
Research Approach ◽  
Content Type ◽  
Business Opportunities ◽  
Survey Responses ◽  
The Impact ◽  
Traditional Roles

PurposeThis paper examines the challenges associated with rural women entrepreneurs in Oman. The study is based on women living in rural and highland areas who aim to move beyond their traditional roles in the family seeking avenues for growth and development. It identifies several problems encountered by rural women entrepreneurs and the impact on their future business opportunities.Design/methodology/approachA mixed research approach involving quantitative and qualitative elements was adopted for the study. The research is based on 183 survey responses and personal interviews with 8 rural women entrepreneurs. Partial least squares structural equation modeling (PLS-SEM) was adopted to analyse the quantitative responses and depict a model featuring the intensity of the problems affecting business opportunities. Seven short cases based upon the interviews with rural women entrepreneurs are also detailed.FindingsSeveral problems experienced by rural women entrepreneurs were identified hampering their business ventures, linked to personality, family, educational, socio-cultural, facilities, legal, financial and economic, organizational and geographical, out of which household, organizational and geographical linked problems were most significant. Entrepreneurial opportunities for rural women entrepreneurs are discussed.Practical implicationsThe research suggests that the policymakers should holistically consider how the rural women engaged in informal business for various means can be better supported and sustained by overcoming associated problems, can achieve business opportunities and contribute to regional socio-economic development.Originality/valueThere is a limited literature available on rural women entrepreneurship in an Arab context. The study provides an overview of the challenges and problems experienced by these women and the support areas required to overcome them for their sustainability in this region.

scholarly journals Developing a Sharīʿah-compliant equity-based crowdfunding framework for entrepreneurship development in Malaysia

2020 ◽  
Vol 12 (2) ◽  
pp. 239-252
Author(s):  
Maya Puspa Rahman ◽  
Mohamed Asmy Mohd Thas Thaker ◽  
Jarita Duasa
Keyword(s):  
Technology Acceptance ◽  
Structural Equation ◽  
Islamic Law ◽  
Reasoned Action ◽  
Sem Analysis ◽  
Ease Of Use ◽  
Equation Modeling ◽  
Content Type ◽  
Entrepreneurship Development ◽  
Acceptance Model

Purpose Crowdfunding has become one of the preferred mechanisms to raise funds by startups and small entrepreneurs. As such, this paper aims to develop an appropriate framework for Sharīʿah-compliant equity-based crowdfunding (SEC) for entrepreneurship development in Malaysia. Design/methodology/approach The research begins by analyzing the intention of 200 entrepreneurs in Kuala Lumpur and Selangor regarding the use of crowdfunding to raise capital. The analysis is based on the theory of reasoned action (TRA), which is also associated with the technology acceptance model (TAM) and is effected by using structural equation modeling (SEM). Findings The entrepreneurs agree on the ease of use of crowdfunding in raising capital, although it appeared that they are quite reluctant to share their business ideas online. Subsequently, an SEC framework is proposed, to further enhance entrepreneurship development in Malaysia particularly in meeting the need for raising funds in line with Sharīʿah (Islamic law) principles. Practical implications This paper aims to contribute more to the development of a blueprint for an SEC platform for market players and regulators in Malaysia. Social implications This paper also aims to highlight the growing needs of entrepreneurs, particularly in Malaysia to have a Sharīʿah-compliant alternative to raise funds via crowdfunding. Originality/value This paper makes two main contributions. First, it provides evidence on Malaysian entrepreneurs’ intention to use crowdfunding for fundraising through TAM and SEM analysis. Second, it proposes an SEC framework for the development of entrepreneurs in Malaysia.

A real asset management approach for Islamic investment in containerships

2020 ◽  
Vol 11 (1) ◽  
pp. 27-48
Author(s):  
Adam Abdullah ◽  
Rusni Hassan ◽  
Salina Kassim
Keyword(s):  
Asset Management ◽  
Profit Sharing ◽  
Content Type ◽  
International Shipping ◽  
Investment Appraisal ◽  
Debt Finance ◽  
Equity Finance ◽  
Management Institutions ◽  
The Impact ◽  
Islamic Investment

Purpose The purpose of this paper is to provide a real asset management investment appraisal of the performance of containerships as a primary segment within international shipping, to facilitate Islamic equity investment through a shipping fund. The objectives are to evaluate the risks and returns of shipping under the framework of Islamic equity finance, and to analyze the performance of investing in containerships over the long term, to appeal to retail and institutional clients of Malaysian asset management institutions. Design/methodology/approach Accordingly, the methodology adopts an investment analysis of a full population of historical data over a period of 20 years, to evaluate performance involving a maritime return on investment (MROI), internal rate of return (IRR), net yield and standard deviation measures of risk and return. Findings The findings reveal that while earnings are volatile in comparison to capital market expectations, unlevered, tax-free returns on containership investments outperform financial and other real assets. Research limitations/implications Shipping is a strong growth industry with about 84 per cent of global trade carried out by the international shipping industry. The problem is that many Islamic asset management institutions and investors have essentially no exposure to Islamic investment in international shipping. Practical implications However, shipping is a highly capital-intensive industry, and currently 75 per cent of ship lending has been conducted by European banks and financed on a conventional basis. Post-financial crisis, ship owners, ship lenders and shipyards have all been exposed to the impact of over-levered balance sheets and debt finance. There is a demand for alternative sources of finance. Social implications By communicating risk and reward more effectively, retail and institutional investors, as well as Islamic finance institutions, will realize that the social benefit of equity finance on the basis of profit sharing is more efficient at allocating investible resources than debt finance at interest, thereby increasing investment and economic growth. Originality/value The significance is that Islamic equity finance, rather than debt at the time-value of money, should enhance the development of international shipping.

scholarly journals Factors influencing Bumiputera contractors' acceptance of the contractor's all risk takāful product

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Mohd Azizi Ibrahim ◽  
Alias Mat Nor ◽  
Raja Rizal Iskandar Raja Hisham
Keyword(s):  
Structural Equation ◽  
Islamic Law ◽  
Reasoned Action ◽  
Peninsular Malaysia ◽  
Sem Analysis ◽  
Content Type ◽  
Sales And Marketing ◽  
Rules And Principles ◽  
Islamic Insurance ◽  
Sabah And Sarawak

PurposeThis research aims to investigate the factors that can influence Bumiputera contractors' acceptance of the Contractor's All Risks (CAR) takaful (Islamic insurance) product using the theory of reasoned action (TRA).Design/methodology/approachUsing the method of quantitative surveys, 414 questionnaires were collected from targeted Bumiputera contractors in Malaysia (grade G1 to grade G7), except in Sabah and Sarawak, that are registered with the Construction Industry Development Board (CIDB) and are also members of Persatuan Kontraktor Melayu Malaysia (PKMM). The data was analysed using the partial least squares structural equation modelling (PLS-SEM) technique.FindingsThe findings from the PLS-SEM analysis show that attitude, subjective norm, religiosity and awareness have a positive relationship with Bumiputera contractors' acceptance of the CAR takaful product. Religiosity appeared to be the most significant factor influencing Bumiputera contractors' acceptance of the CAR takaful product.Research limitations/implicationsThe respondents in this study only comprised Bumiputera contractors in Peninsular Malaysia, excluding those from Sabah and Sarawak. Therefore, it is not possible to generalise the findings to a broader population.Practical implicationsTakaful operators and their sales and marketing departments need to act proactively in promoting the benefits of investing in CAR takaful that follows Sharīʾah (Islamic law) rules and principles. They should create mechanisms to market CAR takaful better, thus accelerating its acceptance rate among contractors.Originality/valueThe paper uses the proposed extended TRA model, which includes the variables of religiosity and awareness in the TRA model. These variables were successfully integrated in the model, and the findings show that they have significantly contributed to the acceptance of the CAR takaful product among Bumiputera contractors.

A structural model assessing key factors affecting women’s entrepreneurial success

2019 ◽  
Vol 11 (1) ◽  
pp. 122-151 ◽  
Author(s):  
Namrata Chatterjee ◽  
Niladri Das ◽  
Nishit Kumar Srivastava
Keyword(s):  
Structural Equation Modeling ◽  
Women Entrepreneurs ◽  
Structural Equation ◽  
Structural Model ◽  
Equation Modeling ◽  
Entrepreneurial Success ◽  
Key Factors ◽  
Chi Square ◽  
Related Factors ◽  
Content Type

PurposeThe present study aims to investigate the influence of key factors on the success of women micro-entrepreneurs in select states of India.Design/methodology/approachAn empirical study is carried out to understand the influence of the psychological, socio-cultural, skill and resource-related factors on the success of women entrepreneurs. To achieve the set goal, a comprehensive questionnaire is developed for collecting data and is analyzed using thet-test, the chi-square test and structural equation modeling.FindingsThe proposed model is validated using structural equation modeling, and the fitness values indicate that the model is fit to explain the entrepreneurial success of women entrepreneurs in India.Practical implicationsThe result advocates that the participation of women entrepreneurs may be increased to not only improve national growth but also empower women in India.Originality/valueIn the context of the women micro-entrepreneurs, no such study covering such a vast area of India has been carried out.

The effect of Muslims’ tendency to regret being customers of conventional banks on their intention to save money in Islamic banks

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Burhanudin Burhanudin
Keyword(s):  
Structural Equation ◽  
Islamic Law ◽  
Emotional Experience ◽  
Partial Least Square ◽  
Least Square ◽  
Equation Modeling ◽  
Islamic Banks ◽  
Banking Services ◽  
Content Type ◽  
Conventional Banks

Purpose There are some Muslims who only hold conventional bank accounts, regardless that some believe that such banks implement an interest charging system that contradicts Islamic law concerning the prohibition of charging interest. This study aims to investigate the consumers’ tendency to regret (CTR) related to purchasing conventional banking services (CTR-P) and the failure to purchase Islamic banking services (CTR-NP). Then, this study investigates whether CTR-P and CTR-NP translate into regret, which, in turn, leads to the intention to save money in Islamic banks. Design/methodology/approach A survey of Indonesian Muslims who only hold conventional banking accounts was conducted. There were 323 participants. This study then applied a partial least square structural equation modeling (PLS-SEM) to test the hypotheses. Findings This study found that a combination of CTR-P and CTR-NP translates into regret, which then drives the intention to save money in Islamic banks as a means of releasing such feelings of regret. The findings suggest that Muslims evaluate their banking decision on an Islamic basis and that making a decision that contradicts the prohibition of charging interest tends to cause regret. Islamic banks have opportunities to penetrate the market by focusing on Muslims who only hold accounts with conventional banks. Originality/value The findings of this study help advance understanding of Muslims’ negative emotional experience due to making a decision that they perceive contradicts Islamic law. Also, the findings help predict the strategy that Muslims use to neutralize such a negative emotional experience.

Gender gap in entrepreneurial growth ambition

2019 ◽  
Vol 25 (6) ◽  
pp. 1283-1307 ◽  
Author(s):  
Jing Wang ◽  
Yaokuang Li ◽  
Dan Long
Keyword(s):  
Gender Gap ◽  
Women Entrepreneurs ◽  
Structural Equation ◽  
Institutional Environment ◽  
Chinese Women ◽  
Environmental Perceptions ◽  
Content Type ◽  
Self Construal ◽  
Chinese Entrepreneurs ◽  
Entrepreneurial Growth

Purpose Since the limited growth of enterprises has been identified as a deliberate choice of women entrepreneurs, the purpose of this paper is to illustrate how the institutional environment of an entrepreneurial ecosystem (EE) fosters the gender gap in entrepreneurial growth intention. The mediating role of the perceived institutional environment in the gender effect on entrepreneurial growth intention is tested in the Chinese context. As individuals’ cognitions are usually influenced by their cultural orientations, the gender difference in perceptions of the institutional environment is considered to be contingent on entrepreneurs’ self-construal. Design/methodology/approach Using a multiregional sample of 206 Chinese entrepreneurs who completed the questionnaire, the study obtained results by adopting a structural equation modelling analysis with a partial least squares approach. Findings There are significant gender gaps in perceptions of the institutional environment and growth intention among Chinese entrepreneurs. Due to their limited political ties and lower legitimacy in economic activities in the country, Chinese women entrepreneurs have more negative perceptions of the regulative and cognitive institutional environment than their male counterparts, which accounts for the lack of growth ambition among Chinese women entrepreneurs. Independent self-construal enlarges the difference in environmental perceptions between male and female entrepreneurs. Originality/value This research enriches the discussion in the emerging area of EEs by adequately responding to the highlighted target to advance ambitious entrepreneurship and offering an interpretation of its evolutionary thinking. Given the increasing calls for a focus on high-growth women’s entrepreneurship, this study provides an explanation for how the institutional environment engenders the absence of women in growth-oriented entrepreneurial activities. It also uncovers the overlooked deficiency in institutional practice by highlighting the gender inequality in the implementation process of entrepreneurial support policies and the distribution of entrepreneurial capabilities in society.

Poverty alleviation through financing microenterprises with equity finance

2017 ◽  
Vol 8 (1) ◽  
pp. 87-99 ◽  
Author(s):  
Salman Ahmed Shaikh
Keyword(s):  
Adverse Selection ◽  
Poverty Alleviation ◽  
Islamic Finance ◽  
Equity Financing ◽  
Content Type ◽  
Debt Finance ◽  
Monitoring Costs ◽  
Enterprise Level ◽  
Islamic Microfinance ◽  
Equity Finance

Purpose This paper aims to achieve scale, efficiency and mitigate high monitoring costs, and explores the efficacy of micro equity finance at the enterprise level. The study compares the economic features of the proposed framework with interest-based debt finance. Design/methodology/approach This study uses a mathematical model to highlight the problem of agency costs including adverse selection and moral hazard. Findings Debt finance requires frequent repayments and indebtedness for financial inclusion. Conversely, the Islamic equity modes of financing in their current baseline structure suffer from high agency costs. By using enterprise level finance and distinct entry criterion for availing Islamic debt-based and micro equity finance, Islamic microfinance institutions (IMFIs) can reach the right targets and effectively mitigate the problem of adverse selection and high monitoring costs. The study suggests a framework in which equity financing could be used to fund microenterprises that will employ poor people with related skills. Research limitations/implications As the preferable modes of Islamic finance, i.e. Musharakah and Mudarabah, are not used by Islamic financial institutions (IFIs), empirical analysis of performance is not possible as they are rarely used. Practical implications The study suggests a workable model that can use Islamic equity-based modes of financing to improve microfinance outreach and achieve scale. The use of equity financing will help the Islamic finance industry to move toward its egalitarian vision, and the practical implementation of the model will help in reducing poverty in the Muslim majority countries. Social implications Muslim countries host half of global poverty, even though their share in global population is only one-fourth. Hence, there is need for solutions in achieving scale in poverty alleviation efforts. Originality/value Using a mathematical model, the paper presents agency problems in Islamic microfinance and proposes a solution through distinct entry criterion and enterprise level micro equity finance.

Antecedents of women entrepreneurs’ performance: an empirical perspective

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Pooja Jha ◽  
Md. Moddassir Alam
Keyword(s):  
Factor Analysis ◽  
Women Entrepreneurs ◽  
Structural Equation ◽  
Developed Countries ◽  
Business Environment ◽  
Training And Development ◽  
Theoretical Background ◽  
Equation Modeling ◽  
Content Type ◽  
The Impact

PurposeThis study investigates the antecedents of women entrepreneurs’ performance in an emerging economy. Based on the review of extant literature, six antecedents of women entrepreneurs’ performance, namely, motivation, networking, socio-cultural, business environment, training and development, and financials were proposed and subsequently empirically examined.Design/methodology/approachGaps in the literature were identified, based on which the theoretical background of the study was formulated. Exploratory factor analysis (EFA) and confirmatory factor analysis (CFA) were applied to confirm the factor-item structure. The impact of explanatory variables was investigated using the structural equation modeling (SEM) based path analysis.FindingsThe study concludes that motivation, networking, socio-cultural, business environment, training and development, and financials have a significant positive influence on the performance of the women entrepreneurs.Originality/valueThere is a dearth of quality research that holistically investigates the key antecedents of performance among women entrepreneurs. Most existing studies have not considered the possible antecedents of performance concomitantly. Additionally, the relationships have been measured individually rather than at the construct level. Further, a majority of the existing studies investigating the performance of women entrepreneurs have been confined to settings within developed countries. By providing insight into the antecedents of women entrepreneurs’ performance elsewhere, the present study attempts to bridge these identified gaps. This study is expected to advance the knowledge about the factors influencing the performance of women entrepreneurs in emerging economies such as India. These insights will likely be valuable when creating policies related to this crucial aspect of economic development.

An analysis of the religious, social factors and income’s influence on the decision making in Islamic microfinance schemes

2020 ◽  
Vol 11 (2) ◽  
pp. 361-376
Author(s):  
Shaheen Mansori ◽  
Meysam Safari ◽  
Zarina Mizam Mohd Ismail
Keyword(s):  
Decision Making ◽  
Social Influence ◽  
Structural Equation ◽  
Islamic Law ◽  
Peer Pressure ◽  
Primary Data ◽  
Decision Making Process ◽  
Data Set ◽  
Content Type ◽  
Islamic Microfinance

Purpose Islamic microfinance schemes are designed and developed with the primary intention of poverty alleviation and fulfillment of the Islamic law requirements. The purpose of this study is to investigate the effects of religiosity, religious leader’s endorsement, social influence and income on the intention to apply for Islamic microfinance among Muslims in Malaysia. Design/methodology/approach This study is based on a public survey to collect primary data from various states in Malaysia. Then, structural equation modelling (SEM) was used to analyse the data set. Findings The results of SEM indicate significant roles for religiosity and religious leader’s endorsement as religion-based factors on intention to apply for microfinance products. Moreover, social influence (peer-pressure) is influential on the financial decision-making process. The authors also examined the moderation effect of gender on these relations and found that females, in comparison to males, tend to be more influenced by religious leader’s endorsement and social influence. On the other hand, male with higher religiosity tend to favour Islamic microfinance products more than females. Originality/value Findings of this study are new in many aspects, most importantly as it sheds light into the role of religiosity and religious leader’s endorsement on the decision-making process in microfinancing services.

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