The purpose of this research is to investigate determinants of SMEs’ intention to use Interest Free (Islamic) Micro Finance services and products by using TPB developed by Ajzen. The study also added two new variables (religiousity and awareness) in the Ajzens Model and investigates their effect on SMEs’ intention to use Interest Free (Islamic) Micro Finance services and products.
For this purpose, the researcher able to collect 282 questionnaires from the total 291 sample size and the collected questionnaires inserted into SPSS. To achieve the objective of the research, the Structural Equation Model (SEM) was applying factor analysis called exploratory factor analysis by reducing not producing useful factors. Before going into hypothesis testing, internal consistency measure such as Cronbach alpha reliability, composite reliability, Discrimant validity, convergence validity, collinearly diagnostic, model fit and indices has adequately dealt with. Apparently, all values for composite reliability and AVE calculated in this study meet the recommended threshold values
The empirical analysis supports TPB and prior research in the field of finance and other domains by confirming that attitudes, subjective norms and perceived behavioural control are significant predictors of SMEs’ intention to use IFMF services and products. Although religiosity showed a non-significant negative relation and is not a predicting factor of SME owner-managers’ intention to use IFMF services and products, awareness did show a significant positive relation and was an important factor in predicting IFMF services and products usage intention.
Inhaltsverzeichnis (Table of Contents)
- CHAPTER ONE
- INTRODUCTION
- Background of the Study
- Challenges for Utilizing the Full Potential of Islamic Finance for SMEs' In Ethiopia
- Statement of the Problem
- Objectives of the Study
- General Objective
- Specific Objective
- Hypothesis Development
- Significance of the Study
- Scope/Delimitation of the Study
- Operational Definitions
- Organization of the Study
- CHAPTER TWO
- REVIEW OF RELATED LITERATURE
- Theoretical Literature Review
- General Concepts and Definition
- Definitions of Small and Medium Enterprises
- Theoretical Foundations for the Financing Behaviour of SMEs'
- Pecking Order Theory
- Trade-Off Theory
- Behavioral Decision Theory
- Theory of Planned Behavior
- Justification of Model Selected
- Empirical Literature Review
- Underlying Principles of Interest-Free Financing
- The IF Business Is Based On Islamic (Sharia) Law
- Paying or Receiving Interest (Riba) Is Forbidden (Haram)
- Utmost Fairness in All Business Dealings
- Transparency, Consensus and Contractual Agreement between Parties in All Business Dealings
- Profit-And-Loss Sharing
- Forbidden (Haram) Business Activities
- Differences between Conventional and Islamic Microfinance
- Islamic Finance and Its Significance for SMEs'
- Islamic Financing Products for SMEs' and Country Experiences
- Determinants of SME financing decision (Capital structure theory paradigm)
- Determinants of SME financing decision (socio-psychological theory approach)
- Empirical Reviews for Islamic Finance Customer's Intention
- Empirical Literature Review: at International Level
- Empirical Literature Review: At National Level
- Research Gaps
- Theoretical Frame Work and Hypotheses Development
- Theoretical Framework of SMEs' Intention
- Hypothesis Development
- The Proposed Research Model
- CHAPTER THREE
- RESEARCH METHODOLOGY
- Research Approach
- Research Design
- Data Source
- Study Area/Organization
- Target Population
- Sampling Methods and Sample Size Determination
- Sampling Methods
- Sample Size Determination
- Data Collection Method
- Primary Data Collection
- Secondary Information
- Method of Data Analysis
- Model Specification
- Measurement of Constructs
- Ethical Considerations
- CHAPTER FOUR
- RESEARCH FINDINGS AND DISCUSSIONS
- Sample and Response Rate
- Questionnaire Pilot Testing
- Validity
- Scale Reliability
- Descriptive Analysis
- Demographic Information of The Respondents
Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)
This research investigates the factors influencing the intention of Small and Medium Enterprises (SMEs) to utilize interest-free (Islamic) microfinance services in Ethiopia. The study employs the Theory of Planned Behavior (TPB) developed by Ajzen and adds two new variables: religiosity and awareness, to explore their impact on SMEs' intention to use Islamic microfinance services.
- Exploring the determinants of SMEs' intention to use interest-free microfinance services.
- Evaluating the applicability of the Theory of Planned Behavior (TPB) in the context of Islamic microfinance.
- Assessing the influence of religiosity and awareness on SMEs' intention to use Islamic microfinance services.
- Analyzing the differences between conventional and Islamic microfinance practices.
- Developing insights to improve policies and practices related to SME financing in Ethiopia.
Zusammenfassung der Kapitel (Chapter Summaries)
- Chapter One: Introduction This chapter introduces the study, outlining the background of SMEs in Ethiopia and the challenges they face in accessing financing options. It highlights the potential of Islamic finance for SMEs and the need for further research. The chapter states the research problem, objectives, hypothesis, significance, scope, operational definitions, and the structure of the study.
- Chapter Two: Review of Related Literature This chapter presents a comprehensive review of relevant theoretical and empirical literature. It covers general concepts and definitions of SMEs, various theories explaining SME financing behavior, and the principles of interest-free financing based on Islamic Sharia law. The chapter compares conventional and Islamic microfinance, explores the significance of Islamic finance for SMEs, and examines existing Islamic financing products and country experiences. Additionally, it discusses determinants of SME financing decisions and provides a critical analysis of empirical research on Islamic finance customer intention both at the international and national levels. Finally, the chapter identifies research gaps and develops a theoretical framework to guide the study.
- Chapter Three: Research Methodology This chapter details the research approach, design, data source, study area, target population, sampling methods, data collection methods, and data analysis techniques employed in the study. It outlines the model specification, measurement of constructs, and ethical considerations adopted.
Schlüsselwörter (Keywords)
This research focuses on the determinants of SMEs' intention to use interest-free microfinance services in Ethiopia. Key terms include: Theory of Planned Behavior (TPB), Islamic microfinance, interest-free financing, SMEs, religiosity, awareness, structural equation model, and Ethiopia.
- Arbeit zitieren
- Zeynu Mohammed (Autor:in), 2022, Determinants of SMEs’ intention to use interest free microfinance service in Ethiopia. The case of Siltie Zone, München, GRIN Verlag, https://www.grin.com/document/1253897
