Dewi Kusuma Wardani & Sri Hermuningsih
d3wi_kusuma@yahoo.co.id
Universitas Sarjanawiyata Tamansiswa
Abstract
Microfinance program focuses on expanding economic activity and improve living standards clients by providing the necessary financial services. Microfinance is also facilitating the development of small businesses. The main purpose of the establishment of MFI “Binangun“ is helping people overcome poverty. It means that the establishment of MFI “Binangun” must be able to provide the required capital of the poor to increase their revenues, either from agricultural activities and other economic activities outside agriculture, such as trading or handicraft industry.
The problem in this research is whether micro finance institution reduces poverty with encouraging the micro business?. This study uses qualitative research approach (qualitative study). The qualitative approach seeks to achieve research objectives by drawing out the primary data in the form view (perception) of the MFI’s stakeholder, like client and government. This approach will analyze and clarify the causes of socio-economic changes that are perceived as the impact of MFIs and the factors affecting the increase in socio performance of MFIs (UNESCAP, 2000).
From the MFIs performance evaluation in Kokap, Kulon Progo, Yogyakarta, can we conclude that the social performance of MFIs is still very limited. MFI is to reduce dependence on moneylenders, but because of administrative requirements that are too complicated and the constraints in terms of human resources, there are still many people who use the services of moneylenders. Therefore there needs to be a model to improve the social performance of MFIs.
Keywords: Micro Finance Institution, Poverty, Micro Business