Microfinance for Small business owners and Entrepreneurship in Transition Countries

Microfinance is mostly a type of funding role of microfinance institutions that is provided to small businesses and entrepreneurs who all don’t have access to traditional money. This includes financial loans, credit, access to saving accounts, insurance policies and cash transfers.

Micro finance establishments are primary sources of money for low income individuals and small businesses that shouldn’t have access to classic banking solutions or have zero collateral. These kinds of institutions present loans and other financing companies at reasonable rates.

The aim of this study is to learn how microfinance and entrepreneurship will be linked in Kazakhstan, a country undergoing changover to some market economic climate. We keep pace with shed light on how microfinance drives small business advancement and formalisation in a transition context and also to explore borrowers’ relationships with MFOs at completely different stages in the process.

The study builds on rising literature that feedback a teleological approach to microfinance (Ault & Spicer, 2014; Chliova, Brinckmann, & Rosenbusch, 2015) and advises a more disovery inquiry that asks more open queries about how microfinance relates to pioneeringup-and-coming outcomes in transitional contexts. This requires making use of methodologies that are more empirically-informed, attuned towards the agency every day entrepreneurs plus more contextually-situated.

We explored borrowers’ relationships with MFOs through a field survey of 86 clients in Almaty and Almatinskaya canton in Kazakhstan, which are representative of both the Overseas MFOs that focus on group lending and Private MFOs that offer individual loans to clients. The study also examined the relationship between borrowers and the MFOs, which was influenced by a choice of factors including their backdrop characteristics, enterprise characteristics and habits of microfinance use.