Operational Risk Management And Performance of Cooperative Microfinance In Thailand

Haris Annannab; Arpah Abu Bakar; Shazida Jan Bt. Mohd Khan

doi:10.36923/ijsser.v4i1.148

Open Access Article Development Studies Business Management and Administration

Haris Annannab ⁽¹⁾ , Arpah Abu Bakar ⁽²⁾ , Shazida Jan Bt. Mohd Khan ⁽³⁾

1. School of Economics, Finance & Banking, Universiti Utara Malaysia, Sintok, Malaysia

2. School of Economics, Finance & Banking, Universiti Utara Malaysia, Sintok, Malaysia

3. School of Economics, Finance & Banking, Universiti Utara Malaysia, Sintok, Malaysia

https://doi.org/10.36923/ijsser.v4i1.148

Issue
Vol. 4 No. 1 (2022)

Submitted
December 21, 2021

Accepted
March 4, 2022

Published
March 31, 2022

Keywords:

Operational Risk Management, Cooperative Microfinance, Specialization, Thailand

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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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Authors

Haris Annannab

https://orcid.org/0000-0002-1244-4210

haris.a@pkru.ac.th (Primary Contact)

Arpah Abu Bakar

https://orcid.org/0000-0002-4538-0487

Shazida Jan Bt. Mohd Khan

https://orcid.org/0000-0002-0463-2051

Author Biographies

Haris Annannab

Haris Annannab: He is a PhD candidate at University Utara Malaysia. He received a bachelor’s degree in Islamic Economic and Banking from Yarmouk University, Jordan and a master’s degree in Islamic Banking and Finance from International Islamic University Malaysia. His current field placement is in Economics, Banking and Entrepreneurship. He has been teaching at Phuket Rajabhat University, Thailand, since 2016.

Arpah Abu Bakar

Arpah Abu Bakar: Dr. Arpah has more than 20 years of experience in risk management and insurance education. She is an Associate Professor at Universiti Utara Malaysia (UUM) College of Business and a research fellow at the Institute of Risk Management, UUM. She served UUM in various leadership capacities, including Head of Banking & Risk Management Department, Deputy Dean of School of Economics, Finance and Banking, AACSB Accreditation Unit. Currently, she is the Director of the Centre of International Affairs and Cooperation (CIAC). She contributes to the University-wide initiative in bridging the gap between academia and industry-community. Dr Arpah has been an active member of the Malaysian Association of Risk and Insurance Management (MARIM) since 2005. She has served as the Honorary Secretary for many years, headed the conference and forum organizing committees, and led the development of the risk management professional certification program. Her main research interests include risk management, health insurance, and risk financing. She has been involved in disaster risk reduction and climate change adaptation research focusing on risk financing for several years.

Shazida Jan Bt. Mohd Khan

Shazida Jan Bt. Mohd Khan: Shazida Jan Mohd Khan graduated with PhD in Economics from the University of Wales, Bangor, in 2011. Her Thesis focuses on Banks’ Efficiency, Competition, and Concentration in Southeast Asia. Shazida Jan Mohd Khan’s broad area of interest in Southeast Asia economics development, concentrating on banking and finance studies, focusing on the financial crisis, structure, efficiency, and performance of banking markets covering conventional and Islamic banking. Her recent work also involves studies on Sustainable Finance, Education Financing, and Micro Financing (SME). She published in various reputable journals, including Journal of Social Science, Research Journal of Applied Sciences, Investment Management and Financial Innovations, America Journal of Economics and Malaysian Management Journal.

Annannab, H., Bakar, A. A., & Mohd Khan, S. J. B. (2022). Operational Risk Management And Performance of Cooperative Microfinance In Thailand. Innovation Journal of Social Sciences and Economic Review, 4(1), 18-25. https://doi.org/10.36923/ijsser.v4i1.148

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