Microfinance is a type of money that is certainly provided to small businesses and entrepreneurs exactly who don’t have entry to traditional financial resources. This includes loans, credit, access to saving accounts, insurance policies and funds transfers.
Mini finance bodies are main sources of money for low income people and smaller businesses that don’t access to traditional banking expertise or have not any collateral. These institutions provide loans and also other financing products at acceptable rates.
The aim of this research is to learn how microfinance and entrepreneurship happen to be linked in Kazakhstan, a region undergoing changover to some market economic climate. We keep pace with shed light on just how microfinance hard disks small business production and formalisation in a transition context also to explore borrowers’ relationships microfinance institutions with MFOs at varied stages for the process.
Our study forms on rising literature that opinions a teleological approach to microfinance (Ault & Spicer, 2014; Chliova, Brinckmann, & Rosenbusch, 2015) and implies a more exploratory inquiry that asks more open questions about how microfinance relates to entrepreneurial outcomes in transitional contexts. This requires choosing methodologies which have been more empirically-informed, attuned towards the agency every day entrepreneurs and even more contextually-situated.
We all explored borrowers’ relationships with MFOs through a field study of 86 clients in Almaty and Almatinskaya districts in Kazakhstan, which are representative of both the Foreign MFOs that focus on group lending and Private MFOs offering individual loans to clients. The study also examined the relationship among borrowers and the MFOs, which was influenced by a variety of factors which include their qualifications characteristics, business characteristics and patterns of microfinance use.
