Socio-Economic Differences and Deployment of the LDC Micro-Finance Bottom-up Approach in DCs

Samanthala Hettihewa and Christopher S. Wright
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Samanthala Hettihewa: University of Ballarat, Australia
Christopher S. Wright: University of Ballarat, Australia

Journal of Electronic Commerce in Organizations (JECO), 2010, vol. 8, issue 2, 41-53

Abstract: Microfinance (MF), after showing great success in poverty-relief in less-developed countries (LDCs), has experiencing rapid growth and interest in developed countries (DCs). However, current DC MF literature gives the impression that survival concerns are diverting DC MF from its original poverty-relief intent. As e-technology evolves, further threats and opportunities are created for MF by changing cost structures and relationships. This study uses descriptive analysis to infer that DC MF needs redesigning for DC socio-economic conditions or it will continue gaining a reputation of being too poorly focused, ineffective, and inefficient for use in DCs. After showing that LDC poverty is harsher than DC poverty, this paper reviews current-performance concerns of DC MF, links those issues with the effect of regulatory and other socio-economic factors on micro-enterprise, discusses how MF can relieve poverty in DCs, and concludes that MF needs refocusing before DCs investing in further developing/adapting MF infrastructure.

Date: 2010
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Persistent link: https://EconPapers.repec.org/RePEc:igg:jeco00:v:8:y:2010:i:2:p:41-53

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