Abstract
Enterprise governance is vital for all types of organizations, including micro entrepreneurs, as it is closely related to performance. Considering that repayable and non-repayable types of microfinance programs exist in Malaysia, this study examines whether different types of financing affect the financial and non-financial performances of micro entrepreneurs. Based on the questionnaires distributed to 485 micro entrepreneurs from Amanah Ikhtiar Malaysia (AIM) and Pusat Pembangunan Usahawan Asnaf Zakat Selangor, followed by interview sessions with 17 of them, this study found that although asnafs financially perform lower than the AIM sahabats, asnafs are generally more satisfied with their overall conditions. The findings suggested that both types of financing have their strengths and weaknesses. Therefore, to improve the current overall practice of microfinance programs in Malaysia, non-repayable programs were recommended to focus on hardcore poor entrepreneurs, whereas repayable programs were advised to focus on the poor category.