MICROFINANCE, ENTREPRENEURIAL SKILLS, AND REPAYMENT TERMS: AN ANALYSIS OF MICRO-ENTREPRENEURS IN HYDERABAD, PAKISTAN
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Abstract
Background and Purpose: Based on Financial Inclusion and Human Capital theories, this study examines the impact of microfinance on entrepreneurial development among micro-entrepreneurs in Hyderabad, Pakistan. It specifically investigates the mediating role of entrepreneurial skills and the moderating effect of repayment terms within this relationship.
Methods: The research employed an explanatory quantitative design to analyze data collected from micro entrepreneurs in the target region.
Results: The findings indicate that microfinance does not exert a statistically significant direct effect on entrepreneurial development. Furthermore, entrepreneurial skills did not significantly mediate, nor did repayment terms significantly moderate, the relationship between microfinance and entrepreneurial outcomes.
Conclusion: The null results suggest that providing credit alone is insufficient to foster entrepreneurial growth. This highlights the necessity for integrated microfinance programs that combine financial access with tailored entrepreneurial training and context-sensitive repayment structures.