Global Journal of Commerce & Management Perspective
Open Access

ISSN: 2319-7285


The Impact of Access to Islamic microfinance Institutions (Islamic MFI) on Poverty Alleviation in Rural Bogor West Java, Indonesia: A Propensity Score Matching Approach

Yani Mulyaningsih, Nunung Nuryartono, Rina Oktaviani and Carunia M. Firdausy

In general, microfinance institutions focus their outreach on the poor, thus it is hoped that Islamic microfinance institutions do to. Currently, the operation of Islamic MFI is headed towards commercialization, signified by the fact that most of the funds originate from public fund mobilization instead of originating from the government. Will the commercialization of Islamic MFI be aligned with the purpose of microfinance institutions in general, which is to help alleviate poverty? The Propensity score matching will be used to estimate the impact of access to Islamic MFI towards poverty. The issue that often arises in studies assessing impact is the presence of selection bias, especially in observational studies. To avoid this issue, propensity score matching is applied. The results of this study demonstrate the absence of impact of access to Islamic MFI towards poverty alleviation in rural areas in Bogor, Indonesia, if the Islamic MFI operates commercially