Examining the effect of participation in microcredit programs on assets owned by hardcore poor households in Malaysia

This study employs a cross-sectional design with quasi-experimental approach to examine how participation in microcredit schemes affects hardcore poor householdʹs assets. Assets tend to be more stable over time and it is a good indicator of economic well-being; therefore, this study measures the impact of Amanah Ikhtiar Malaysiaʹs (AIM) microcredit schemes on assets owned by hardcore poor households in Peninsular Malaysia. Findings from this study confirm that the amount of loan received has a significant positive linear relationship with total productive assets and number of gainfully employed members, which subsequently leads to increase in household assets. It is recommended that AIM focus on review and re-organization of credit policies in order to increase clientʹs ability to invest higher amount of loan to generate income and it should also initiate new strategies to reduce unemployment rate among the clientʹs households.