Title: Intention to use the Islamic micro-investment model in Nigeria: empirical evidence

Authors: Aliyu Dahiru Muhammad; Mohamed Aslam Haneef; Mustafa Omar Mohammed

Addresses: International Institute of Islamic Banking and Finance, Bayero University Kano, Nigeria ' Centre for Islamic Economics, International Islamic University, Malaysia ' Centre for Islamic Economics, International Islamic University, Malaysia

Abstract: Microfinance was celebrated as an effective tool for poverty alleviation. However, evidence shows that it has been charging high interest rates and exploiting poor income earners. Islamic microfinance, on the other hand, appears too expensive and pursues debt-like contracts that are tantamount to riba. In the case of Nigeria, conventional microfinance has failed to serve the needs of majority poor. Developing an Islamic micro-investment model (IMIM) based on genuine partnership contracts is deemed an appropriate option to overcome the challenges of the existing microfinance institutions. This study develops and tests the Islamic micro-investment model [IMIM based on the theory of reasoned action (TRA)]. The study uses structural equation modelling to examine the applicability and acceptance of the model in Kano State, Nigeria. The result shows that the model fits the data well and that attitude is the major determinant of intention to accept the IMIM among users.

Keywords: Islamic finance; micro-investment models; Islamic microfinance; micro-entrepreneurs; Nigeria; Islam; modelling; Nigeria; entrepreneurship; micro enterprises; poverty; theory of reasoned action; TRA; structural equation modelling; SEM; intention to adopt.

DOI: 10.1504/IJPEE.2016.079689

International Journal of Pluralism and Economics Education, 2016 Vol.7 No.3, pp.283 - 299

Accepted: 11 Apr 2016
Published online: 09 Oct 2016 *

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