Review of the Socio-Economic Impact of Micro-Credit in Malaysia

Microcredit institutions provide small-scale financial services to low-income and poor households in order to improve their socioeconomic condition. This paper is crucial to understand whether the literature supports the role of microcredit in boosting income progressively among low-income households, who are vulnerable to poverty. Thus, this paper identified the relevant literature of the effect of microcredit programs on socioeconomic well-being among low-income households including household income, enterprise income, enterprise asset, and economic vulnerability. The review determined a positive relationship between the constructs. However, empirical research penetration is required to bridge the gaps in the literature of microcredit and poverty eradication in the context of Malaysia. This paper provides insights into issues related to the intersections of microcredit and poverty that are important for governments, developmental organizations, and researchers.