examining the effectiveness of micro-enterprise development programs in malaysia

Previous studies on socioeconomic development have examined the effect of development initiatives (i.e., access to finance and training) on several socioeconomic indicators (i.e., income, empowerment, asset, quality of life, employment). These studies have focused mostly on the outcomes of specific types of programs offered by specific development organizations. This study however focuses on informal women micro-entrepreneurs’ participation in various development programs available to them and their influence on entrepreneurial competencies, human capital development, competitive advantages, economic vulnerability, supportive environment, and performance of micro-enterprises. This cross-sectional study adopted the purposive random sampling method and collected data from 384 informal women entrepreneurs from the local markets in different districts of Kelantan, Malaysia. The findings show that the development program participants have relatively higher levels of entrepreneurial competencies, human capital development, and higher levels of enterprise performance compared to non-participants. It is also noted that the level of economic vulnerability is relatively low among participants compared to non-participants. However, these findings contradict most of the earlier studies that show a significant positive impact of micro-credit on socio-economic wellbeing, as the difference in entrepreneurial competencies, human capital development, economic vulnerability, and performance of micro-enterprises among participants and non-participants in this study is not statistically significant. However, findings reported significantly higher levels of competitive advantages, and better supportive environment among the participants compared to the non-participants. Development organizations should therefore focus on expanding their outreach to spread the positive effects of their development programs towards uplifting the economic condition of low and middle-income households in Malaysia.