Sheena RagooFollow

Publication Date

Spring 4-25-2017

School

School of Business

Major

Business: Economics; Business: Finance

Keywords

Microcredit, Entrepreneurship, Microloans, Asia, Poverty

Disciplines

Entrepreneurial and Small Business Operations | Finance and Financial Management

Abstract

Microcredit can be a powerful tool to aid impoverished individuals in Asia. Despite the increased globalization and interconnectedness around the world, many parts of Asia suffer from the social and economic problems. However, entrepreneurship programs can help alleviate some of the social ailments. Unfortunately, many individuals in the Asian region do not have the financial means to start their own businesses. Individuals may be able to fund their businesses by means of small loans. Microcredit not only empowers poor individuals, it also gives them the opportunity to be self-employed and become self-sufficient. Women are the main beneficiaries of microcredit financial services. Many women are excluded from economic and political life, which creates a problem for them to feed and support their families. The microloans may give women an opportunity to contribute to the overall economy by enabling them to start a business. Throughout history, microcredit services have been provided by non-profit and non-governmental organizations. The need for microcredit in Asia is pertinent due to income disparities, corruption, religious conflicts, persistent poverty, and the exclusion of women from the public sector. Microcredit can impact the economy by increasing individual’s income, reduce unemployment, improve the standard of living, and increase economic growth. On the other hand, microcredit carries high-risk, and repaying microloans can be burdensome when the funds are being misused.

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