The Appreciative Intelligence Framework of Islamic Microfinance Instrument for Quantity Rationing to Increase Participation of People at the Bottom of the Economic Pyramid

Abstract

This study solicited Islamic microfinance practitioners for a framework of appreciative intelligence for Islamic microfinance instruments in order to surmount obstacles in the practice of quantity rationing assessment. Based on methods of purposive sampling, 26 Islamic Microfinance Institutions (MFIs) in Indonesia were selected. One instrument was created to capture data, namely an in-depth interview to characterize the data associated with the proposed solution. The findings of this study provide several solutions for quantity rationing issues in order to increase the impact of BMT on welfare-improving objectives. The majority of respondents agreed that a write-off and the role of zakah, infaq, and shadaqah are the most desirable solutions in the event of financing default. In the event of financing default, rescheduling the financing and sending a card for an ATM to BMT are additional options. Lastly, some BMT practitioners propose using savings as collateral and expanding the role of zakah, infaq, and shadaqah in BMT to address financing default. The majority of BMT borrowers concurred that a special margin on time deposits made 2-3 months prior to the peak season would address the problem of lack of liquidity during the peak season. In addition, a gift of savings is an alternative solution. The majority of BMT practitioners choose a financing donor as the most desirable solution and continue to use channeling and other BMT as solutions for insufficient own capital sources. BMT must provide funding on a low nominal basis in order to ensure that impoverished people are treated equitably. Standardization of borrowing limits must also be implemented.