The influence of microfinance initiatives on capabilities of Vietnamese participants - a qualitative study
Creators: name: Bui, Minh Le
Publisher: name: Zenodo
Year: 2024
Subjects: microfinance
developing countries
participant capabilities

description: Research purpose: In developed countries such as the USA, the UK and Europe, microfinance is becoming a global phenomenon, as well as in developing countries. Against this development,however,there hasbeen little intheway ofresearch totry tounderstand the multidimensional impacts ofthe programs, particularly in Vietnam. This research attempts to explore how microfinance initiativesinfluence Vietnamese participants’ capabilities. The conclusion ofthisthesis will provide answerstotwo sub-questions: investigating the impacts of microfinance programs as well as examining howmicrofinance programs promote these impacts.Research methodology/design: This research adopts the social and financial exclusion framework to understand the effects of microfinance schemes. Meanwhile, social exclusion isgraduallybeingusedinmanynationssuchastheUK,AustraliaandEurope,tofacilitatethe influences ofmicrofinance. The concept of social exclusion provides a multifaceted approach to understand thedrawbacksforhouseholdswithlowincomes; oneofthe primarypurposes ofmicrofinanceinitiativesinVietnam was the distribution of financial products and services to those unable to use traditional financial products—financial exclusion is critical. The research strategy ofthisstudy relies on threemajor areas: what an individual desires, what capabilities aperson hasto achieve it,including freedomand the choice to do the thingsthat he orshe values, and the agency. A triangulation of data collectionwas adopted, including semi-structured interviews and participant observation, as this research focusedon individual experiences andnarratives.Research findings: Research findings revealed the effects of microfinance, including the influenceon participantsfrom a financial aspect, the impact on the social dimensions of the participants and theproduction of improved capabilities. Furthermore, interviewees referred to the economic effects byhighlighting four key issues: increased levels of savings, increased financial capacity, increasedfinancial security and higher levels of economic participation. Such results were accomplished byintegratingthefinancialaspectsoftheprograms,aswell as by providing support networks.Thesocialaspectofthemicrofinanceschemeswasmainlyaffectedbyinvolvementinsavings andloans.Such services offered incentives for social interaction with participants. The social impacts felt byparticipants was more significant support, greater confidence, mutual feelings andasenseofbelonging.Alloftheseimpactsarestronglyinterlinkedinrelationtosocial networksthatcanbeshapedaspeoplemeet, hence, enhancing the social capital. What was noticed wasthat a mixture of financial and socialfactors providedparticipantswith amore substantial capability.Research implications: The critical impact of this work is that if initiatives are actually to enhancethe capacities of low-income people and families, then more financial services and opportunities forpeople need to be provided, allowing the interaction with each other. This is a mixture of the twoprogramsthatincrease people’s capacity.