Operational Risk Management And Performance of Cooperative Microfinance In Thailand
Abstract
The purpose of this study is to investigate the impact of operational risk management (ORM) on the performance of cooperative microfinance institutions, with a particular focus on the moderating role of specialization in this relationship. Using a quantitative research approach, survey questionnaires were distributed to 455 senior officers from savings and credit cooperative microfinance service providers (MSPs) in Thailand. Data analysis was conducted using Structural Equation Modeling (SEM) via SmartPLS software version 3.0. The findings reveal that ORM has a significant positive impact on the performance of cooperative microfinance institutions. Moreover, specialization was found to play a crucial moderating role, enhancing the positive relationship between ORM and performance. The study concludes that effective ORM, when combined with specialized knowledge and skills within cooperative microfinance institutions, leads to improved performance outcomes. These findings have important implications for policymakers, particularly the Bank of Thailand and the Ministry of Finance, as they work to develop and refine microfinance policies and programs that support sustainable growth and risk management in the sector.
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