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FOSEI UNSOED
5/30/2018
Micro Enterprises (MEs) in Malaysia becomes as an important engine for economic growth. They account for a substantial share of total SMEs (Small and Medium Enterprises), employment and gross domestic product (GDP). Indeed, they are contributing significantly to the poverty alleviation. In Malaysia, the definition of MEs follows the definition developed by the National SME Development Council (NSDC) based on two criteria, namely full-time employees and annual sales turnover. MEs in Malaysia are defined as the establishment with less than five employees or less than RM 300,000 of the sales turnover for manufacturing sectors and RM300,000 for other sectors namely agriculture, mining, quarrying, construction and services. However, if one of the criteria of MEs either number of employee or annual sales turnover is exceeded the requirement, then the lowest will be given priority.
MEs in Malaysia constitute 77 percent of total SMEs in Malaysia along with small and medium enterprises with 20 percent and 3 percent, respectively. It forms a largest formation of the enterprises along with small and medium enterprises. Furthermore, among the sectors, the bulk of the services sector is micro establishments, representing over 79.0 per cent of total SMEs. The manufacturing and agriculture sectors also show the same pattern where micro businesses are predominant, accounting for more than half, with 57.1 per cent and 56.3 per cent, respectively. It is followed with the construction sector, where the MEs form about 45 percent.
Cash Waqf means the devotion of an amount of money by a founder and the dedication of its usufruct in perpetuity to the prescript purposes. In this case, the donor endowed Cash Waqf instead of real estate or fixed asset. The use of Cash Waqf comes into the field in eight century after Imam Zufar had approved its use. Based on his view, Cash Waqf can be invested through partnership basis and the profits generated would be spent for the charity purposes.
The proposed Waqf based Islamic microfinance institution model (WIMFI) for channeling funds to facilitate wealth creation for the poor. The WIMFI model constitutes of cash Waqf which becomes the capital of microfinance institutions. In addition, along with the Waqf endowment donated by the founders, additional Waqf-funds can be generated by issuing Waqf certificates. Later, the Islamic MFI and the client can jointly finance the purchase and selling of a certain good and distribute the profit via various kinds of financing arrangements such as Mudharaba, Musharakah, Murabahah, Ijarah, Salam, and Istisna. However, his study is more related to the integration of Waqf into Islamic microfinance institution. It differs from the present study where the present study focuses on Cash Waqf and integrating it directly to microenterprise.
It is believed that the social pressure groups that assert subjective norms, including family members, relatives, friends, neighbor and co-workers, influence the decision-making process for the survey respondents who are interested in using Cash Waqf Investment Model in the future. This finding is consistent with previous research that social pressure groups have a positive impact and strong influence on behavioral intention.
The outcome of the current study for subjective norm is also similar in the direction. The intention to use Integrated Cash Waqf Investment Model by micro enterprises is influenced by social pressure groups, including family members and friends. Hence, it is recommended that Waqf institutions recognize the power of social pressure groups and develop methods of information dissemination to these groups particularly.
Therefore, Waqf institutions need to find ways to provide and disseminate information about Cash Waqf Investment Model to the social pressure groups of influence (for example, family, friends, and co-workers). For example, Waqf institutions can utilize mass media such as television, radio, newspaper or magazine to provide information about Cash Waqf Investment Model. Furthermore, Waqf institutions can also conduct awareness programmes or campaign to the social pressure groups of influence. By providing and disseminating information about Integrated Cash Waqf Investment Model to the social pressure groups of influence, micro enterprises may be more likely to gain support for their intention to use Integrated Cash Waqf Investment Model. This has implications for individuals and potential micro-entrepreneurs. Thus, it can be suggested that Waqf institutions has to plan a way on how to develop connection with social groups that relate to micro enterprises including family, friends, and co-workers.
Although it can be argued that various financial and human capital development programmes and schemes are provided by the government and relevant agencies, numerous issues in relation to access to finance and human capital development appeared. Based on empirical findings, the issues related to accessing finance such as (i) high interest rate, (ii) strict documentation requirement, (iii) strict collateral requirement, (iv) insufficient amount of financing, (v) long loan durations, and (vi) nature of business are affecting the development and contribution of microenterprises in Malaysia. On the other hand, issues of experience, training, and skills are also hampering the human capital development of microenterprises.
SUMBER PUSTAKA
Duasa, Jarita dan Mohamed Asmy Bin Mohd Thas Thaker. 2016. ”A Cash Waqf
Investment Model: An Alternative Model for Financing Micro-Enterprises in Malaysia”. Journal of Islamic Monetary Economics and Finance. Volume 1, Nomor 2.
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