Impact of microfinance on women entrepreneurial development : a case of ILO-PALM joint intervention in Eastern Sri Lanka

Abstract

Introduction :

Entrepreneurship is the dynamic process of creating incremental wealth (Donald and Richard, 2001). The development of microfinance institutions (MFIs) over the last two decades had a positive impact on making entrepreneurial development and it become a powerful instrument in combating poverty in developing countries (Ngozi, 2002) and contributed to empowering women and removing gender inequalities. Thilepan and Thiruchelvam (2011) proved that microfinance has a major role on entrepreneurial development through the favorable loan conditions, low interest rate, flexible repaying period and trainings in Sri Lanka.

Small and micro-enterprises (SMEs) is the major source of living ofmany people in the post conflict environment which also ensures sustainable livelihood of women headed families in North and Eastern provinces of Sri Lanka (Thilepan and Thiruchelvam, 2011). Government Organizations (GOs); and International and Local Non- Governmental Organizations (INGOs and NGOs) have become increasingly involved in providing financial services to women entrepreneurial development to ensure sustainable livelihood in these areas. However, the topic of women entrepreneurship development has been neglected in the social science research in the past (Sathibama, 2010). Consequently, few empirical research on impact assessment of microfinance on women entrepreneurial development in post conflict environment in Sri Lanka have been conducted and even they lacking empirical analysis. Therefore, this study attempts to fulfill this research gap by investigating the impact of the microfinance intervention on development of the women headed entrepreneurship in Sri Lanka.