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Kut (informal rotating credit) in the livelihood strategies of urban households in Penang, Malaysia

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Abstract:

The importance of social capital in both rural and urban communities is an often-published topic. By representing the operation of social capital networks, this paper explores the persistence of informal rotating credit in the livelihoods of low-income, urban households in Penang, Malaysia. It highlights the function of such credit and the ways in which it benefits poor women and their households. This paper suggests that informal credit reduces the probability of being poor, and the returns to household investment in social capital are higher for the poor than for the population at large. The downside of such social capital is also discussed. The paper concludes that informal credit is enhanced in the urban settings due to the increase in income opportunities, especially for women.

Keywords: Malaysia; Penang; informal credit; livelihood strategies; urban poor; women

Document Type: Research Article

DOI: http://dx.doi.org/10.1111/1475-4762.t01-2-00106

Affiliations: Geography Section, School of Humanities, Universiti Sains Malaysia, Penang, Malaysia, Email: suriati@usm.my

Publication date: June 1, 2003

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