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1
Kittilaksanawong, Wiboon, and Hongyu Zhao. "Does lending to women lower sustainability of microfinance institutions? Moderating role of national cultures." Gender in Management: An International Journal 33, no. 3 (May 8, 2018): 187–202. http://dx.doi.org/10.1108/gm-11-2015-0098.
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Purpose This study aims to investigate whether lending to women decreases sustainability of microfinance institutions (MFIs) and how regional characteristics where MFIs are located moderate this effect. Design/methodology/approach Financial and operating data of MFIs and national cultures are available from the MIX Market database and the Hofstede’s publications. These data are analyzed by using multiple regression models with the financial self-sustainability, proportion of women borrowers in the MFI’s lending portfolio, and dimensions of national culture as dependent, explanatory and moderating variables. Findings Lending to women tends to reduce sustainability of MFIs. This negative effect is more pronounced in countries ranking higher on power distance and individualism, but the effect is less serious in countries ranking higher on masculinity and uncertainty avoidance. Originality/value Many studies demonstrate that MFIs improve their repayment rates by targeting women borrowers. The increase in repayment rates, however, may not always improve their sustainability. Further, as microfinance industry increasingly diversifies geographically, regional characteristics where MFIs are located play a vital contingent role in their sustainability.
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Mohamad Anwar, Nazratul Aina, Hafezali Iqbal Hussain, Fakarudin Kamarudin, Fadzlan Sufian, Nurazilah Zainal, and Che Mun Wong. "Impact of regulatory efficiency and market openness to social and financial efficiency: empirical evidence from microfinance institutions." Society and Business Review 16, no. 3 (January 27, 2021): 374–97. http://dx.doi.org/10.1108/sbr-04-2020-0056.
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Purpose Microfinance institutions (MFIs) play a significant role in society to help low-income consumers that liaise with sustainable development goals. Therefore, the purpose of this paper is to examine the effects of two economic freedom components, namely, regulatory efficiency on business freedom and monetary freedom; and market openness on investment freedom and financial freedom. Their influence on the efficiency of MFIs in both social and financial ways is examined. Design/methodology/approach This study collected a total of 88 MFIs from Thailand and the Philippines for the years 2011 to 2017. The data envelopment analysis approach has been used to measure the MFIs’ efficiency level. Then, the ordinary least squares and generalised least square estimation methods serve to analyse the effects of economic freedom and other determinants on efficiency. Findings The results show that overall MFIs operate at an encouraging level. However, they were managerially inefficient when exploiting resources to achieve both social and financial efficiency. Therefore, MFIs should focus more on managerial operations to improve the level of efficiency. Results from panel regression analysis showed a mixed outcome for the relationship between economic freedom and MFIs’ efficiency both financially and socially. This suggested that different freedoms will result in different outcomes and significantly influence MFIs’ financial and social efficiency. Originality/value Regulatory efficiency and market openness are the vital aspects of economic freedom components that may significantly influence MFI’s performance specifically on social and financial efficiency. This study fills the research gap by examining the relationship between economic freedom components and specific MFIs’ social and financial efficiency, to ensure MFIs work to achieve sustainable development goals.
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Njuguna, Dr James Rurigi, Prof Roselyn Gakure, Dr Anthony Gichuhi Waititu, and Dr Paul Katuse. "STRATEGIC RISK MANAGEMENT STRATEGIES AND THE GROWTH OF MICROFINANCE SECTOR IN KENYA." Journal of Business and Strategic Management 2, no. 2 (March 1, 2017): 17. http://dx.doi.org/10.47941/jbsm.119.
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Purpose: The purpose of this study was to establish how strategic risk management strategies contribute to growth of MFI sector in KenyaMethodology: The study adopted a correlation survey research design. The population of this study was fifty seven (57) MFIs. The sampling frame was the list of MFIs provided in the AMFI website www.amfikenya.com. A sample of thirteen (17) MFIs was selected using the random sampling approach. A questionnaire and an interview schedule were the main data collection tools. Qualitative data was analyzed using content analysis whereas the quantitative data was analysed using Statistical Package for Social Sciences (SPSS) where descriptive and regression analysis were conducted to determine the relationship between enterprise risk management strategies and growth of MFIs.Findings: The findings indicated that there were several strategic management measures that had been put in place by MFI to promote growth. These included the existence of a board with the skills and ability to lead the MFI strategically. In addition, the board members roles extended beyond governance and into management of the MFI and the board had policies stipulating term limits and rotation for its members. Results further indicated that the board had adequate independent directors who agreed on the MFIs mission and strategic direction. The results revealed that the MFI had guidelines for preventing conflicts of interest among board members and the MFI guidelines prohibited related-party (insider) lending, required full disclosure of all conflicts of interest, and required arm’s length business transactions. Findings further indicated that the MFI’s organizational structure ensured staff accountability and enhanced MFI’s efficiency and productivity. Overall, regression results indicated that there was a positive relationship between strategic risk management strategies and MFI growth.Unique contribution to theory, practice and policy: Following the study results, it was recommended that the MFIs need to enhance effectiveness of strategic risk management practices such as adherence to best practices on corporate governance. In addition, the MFIs need to enhance the skills of the board members as doing so would improve the level of strategic risk management practice. The study recommended that those MFIs that had not implemented the guidelines for preventing conflicts of interest among board members are advised to do so as this may have an impact on the level of growth. It is recommended that MFIs need to put in place guidelines prohibiting related party (insider trading) and also require full disclosure of all conflicts of interest as doing so would improve the growth of the MFI. Furthermore, MFIs need to increase the number of independent directors in their boards as doing so would improve the growth of the MFIs.
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Azriani, Zednita, Cindy Paloma, and Yusri Usman. "The Mapping of Microfinance Institutions for Supporting Sustainable Agriculture Financing in Padang City." Jurnal Agro Ekonomi 35, no. 1 (March 1, 2018): 1. http://dx.doi.org/10.21082/jae.v35n1.2017.1-10.
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<p><strong>Indonesian</strong><br />Lembaga Keuangan Mikro (LKM) merupakan salah satu alternatif pembiayaan bagi. Pemetaan LKM sangat penting untuk menghindari terjadinya tumpang tindih program yang membantu peran LKM. Penelitian ini bertujuan untuk melakukan pemetaan terhadap LKM di Kota Padang dengan GIS dan mendeskripsikan efektivitas pengelolaan LKM di Kota Padang. Data dikumpulkan melalui wawancara dengan setiap institusi LKM dan pihak terkait. Penelitian menghasilkan suatu situs web yang berhubungan dengan LKM di Kota Padang, sehingga hasil dan gambaran pemetaan LKM dapat dilihat di “lkmsumbar.org”. Lokasi LKM menyebar di sekitar pemukiman nasabah. Manajemen LKM ditinjau dari segi aksesibilitas, ketaatan terhadap peraturan, tingkat kepatuhan terhadap manajemen, tingkat pelayanan, alokasi penggunaan dana kredit, serta manfaat dana kredit. Hasilnya menunjukkan bahwa akses petani terhadap LKM agribisnis cukup baik, sebagaimana dapat dilihat dari kesesuaian antara jumlah kredit yang diajukan dan disetujui. Tingkat kepatuhan anggota terhadap pengurus dan peraturannya cukup bagus. Tingkat layanan pengurus dianggap tidak baik dan tidak efektif dalam meladeni anggota. Dana pinjaman lebih banyak digunakan oleh anggota untuk menambah modal dan sebagian mungkin digunakan untuk memenuhi kebutuhan mendesak rumah tangga.</p><p><br /><strong>English</strong><br />Microfinance institutions (MFIs) are financing alternatives for farmers. Mapping MFIs is useful to avoid overlapping of the MFIs supporting programs. This study aims to mapping MFIs in Padang City with GIS, and to describe the management effectiveness. Data were collected using in-depth interviews with each micro-credit institution and their related parties. This research produces a website of the MFI mapping as can be seen on “lkmsumbar.org”. The MFIs locations spread around the settlement of the MFI’s clients. The effectiveness of MFI's management is viewed in terms of the member accessibility, level of adherence to the rule of law, level of compliance to the management, management service level, allocation of the use of credit funds, and the benefits of credit funds. The results show that farmers' access to the agribusiness MFI-As is quite good, which can be seen from the consistency between the amount of credit proposed and approved. The members’ compliance to the board and the rules is quite good. The service level of the board is not good and not effective in serving the members. The loan is mostly used for business capital and some may be used for funding household urgent needs.</p>
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Singh, Vijeta, and Puja Padhi. "Factors Influencing Outreach Performance of Microfinance Sector in India." Asia-Pacific Journal of Management Research and Innovation 15, no. 4 (December 2019): 162–76. http://dx.doi.org/10.1177/2319510x19883705.
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In recent years microfinance institutions (MFIs) have been duly recognised as an important component of financial system as MFIs can facilitate the agenda of financial inclusion. MFIs provide unbanked and poor appropriately designed financial products and services. MFIs have addressed the issues concerning supply-side barriers 1 to financial inclusion by enhancing its outreach across the countries/regions. However, outreach performance of MFIs is affected by factors concerning MFIs such as age, size, profitability, efficiency, productivity and portfolio quality, which affect outreach (breadth/depth) of MFIs. The present study has attempted to study the factors affecting outreach performance of MFIs in India. The study using unbalanced panel data for 39 Indian MFIs concludes that age, assets and productivity indicators have affirmative association with outreach performance of MFIs in India.
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Chauhan, Nitanshu, Navjeet Bagga, Shashank Banchhor, Chirag Garg, Arvind Sharma, Arnab Datta, S. Dasgupta, and Anand Bulusu. "BOX engineering to mitigate negative differential resistance in MFIS negative capacitance FDSOI FET: an analog perspective." Nanotechnology 33, no. 8 (December 2, 2021): 085203. http://dx.doi.org/10.1088/1361-6528/ac328a.
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Abstract Till date, the existing understanding of negative differential resistance (NDR) is obtained from metal-ferro–metal–insulator–semiconductor (MFMIS) FET, and it has been utilized for both MFMIS and metal–ferro–insulator–semiconductor (MFIS) based NCFETs. However, in MFIS architecture, the ferroelectric capacitance (C FE) is not a lumped capacitance. Therefore, for MFIS negative capacitance (NC) devices, the physical explanation which governs the NDR mechanism needs to be addressed. In this work, for the first time, we present the first principle explanation of the NDR effect in MFIS NC FDSOI. We found that the output current variation with the drain to source voltage (V DS), (i.e. g ds) primarily depends upon two parameters: (a) V DS dependent inversion charge gradient (∂n/∂ V DS); (b) V DS sensitive electron velocity (∂v/∂ V DS), and the combined effect of these two dependencies results in NDR. Further, to mitigate the NDR effect, we proposed the BOX engineered NC FDSOI FET, in which the buried oxide (BOX) layer is subdivided into the ferroelectric (FE) layer and the SiO2 layer. In doing so, the inversion charge in the channel is enhanced by the BOX engineered FE layer, which in turn mitigates the NDR and a nearly zero g ds with a minimal positive slope has been obtained. Through well-calibrated TCAD simulations, by utilizing the obtained positive g ds, we also designed a V DS independent constant current mirror which is an essential part of analog circuits. Furthermore, we discussed the impact of the FE parameter (remanent polarization and coercive field) variation on the device performances. We have also compared the acquired results with existing literature on NC-based devices, which justifies that our proposed structure exhibits complete diminution of NDR, thus enabling its use in analog circuit design.
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Njuguna, Dr James Rurigi, Prof Roselyn Gakure, Dr Anthony Gichuhi Waititu, and Dr Paul Katuse. "OPERATIONAL RISK MANAGEMENT STRATEGIES AND THE GROWTH OF MICROFINANCE SECTOR IN KENYA." Journal of Business and Strategic Management 2, no. 2 (March 1, 2017): 42. http://dx.doi.org/10.47941/jbsm.120.
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Purpose: The purpose of this study was to establish how operational risk management strategies lead to growth of MFI sector in Kenya.Methodology: The study adopted a correlation survey research design. The population of this study was fifty seven (57) MFIs. The sampling frame was the list of MFIs provided in the AMFI website www.amfikenya.com. A sample of thirteen (17) MFIs was selected using the random sampling approach. A questionnaire and an interview schedule were the main data collection tools. Qualitative data was analyzed using content analysis whereas the quantitative data was analysed using Statistical Package for Social Sciences (SPSS) where descriptive and regression analysis were conducted to determine the relationship between enterprise risk management strategies and growth of MFIs.Findings: Findings revealed that the MFI had adequate policies and procedures to manage its operational risks and the MFI had an operations manual. The findings also indicated that the MFIs have adhered to written policies and procedures to manage operational risks in the financial operations area, procurement area, treasury area, and financial management area. Results further indicated that the MFI had effective internal control systems for detecting fraud or other significant operational risks. Finally the study findings indicated that MFI’s internal audit functions ensured effective use of resources, accurate financial reporting, and ample random spot checks of MFI branches, clients, and staff. The regression results indicated that there was a positive relationship between operational risk management strategies and MFI growth.Unique contribution to theory, practice and policy: The study recommends that the MFIs to continue practicing effective operational risk management practices such as internal control framework comprising of policies and procedures. MFIs need to uphold the existence and accessibility of operational manuals. It is suggested that adherence to written policies and procedures is positive strategy and it should be emphasized. The internal audit functions for effective use of resources and accurate financial reporting needs to be emphasized as it had a positive effect on growth. The MFIs should also benchmark their technology with that of banks to reduce human error, to produce timely and relevant data. It is recommended that implementation of know your client (KYC) requirements should be enhanced as it has an effect on growth.
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Rupa, R. "Indian NBFC MFIs Vs. Bangladeshi NGO MFIs." Asian Journal of Management 8, no. 2 (2017): 305. http://dx.doi.org/10.5958/2321-5763.2017.00046.4.
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Rasheed, Burhan, Zohair Farooq Malik, Amer Shakeel, and Syed Taha Fraz Haider Kazmi. "Evaluating the State Laws and Regulations of Microfinance Institutions (MFIs) in Asia: A Comparative Study." Audit and Accounting Review 1, no. 2 (December 1, 2021): 91–110. http://dx.doi.org/10.32350/aar.12.05.
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This study evaluates the laws and regulations of Microfinance Institutions (MFIs) in Asia. It compares the regulatory framework of MFIs with institutional development and macroeconomic perspective and concludes that central banks control formal MFIs by applying legislation. Conversely, semiformal MFIs are regulated and controlled by a government body or an apex organization. Unfortunately, informal MFIs are not regulated at all. It was observed that even though regulations are effective; however, the ownership structure, governance, and internal controls are not adequate and appropriate for all types of MFIs. Since the existing rules do not apply to all MFIs, this study recommends formulating special prudential regulations for MFIs, similar to the ones used in the banking sector. Formulating regulations should be the responsibility of the government, central banks, private sector, and the donors. Furthermore, regulators should develop a separate team of qualified members to monitor the regulatory environment, protect the interest of depositors and donors, and encourage MFIs to attain sustainability as well as outreach.Keywords: central banks, Microfinance Institutions (MFIs), prudential regulations, regulatory bodyJEL classifications: G2, G21, G28
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Deb, Joyeeta. "Impact of Competition on Social Performance of MFIs: Comparative Analysis of India and Bangladesh." Vision: The Journal of Business Perspective 24, no. 2 (December 30, 2019): 160–70. http://dx.doi.org/10.1177/0972262919875536.
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Although studies encompassing the different aspect of microfinance like sustainability of microfinance institutions (MFIs), role of microfinance in poverty alleviation, etc., have enriched the literature from time to time, studies on competition and its impact on social performance of MFIs are scarce. There also exists lacking consensus as to how can competition influence MFIs’ social performance. The empirical evidence reveals duality of opinion. With information asymmetry, competition enhances borrowers’ indebtedness and lowers expected loan repayment and impeding loan quality. Furthermore, in order to overcome these problems, MFIs would engage in more screening that raises their operational costs. This encumbers the sustainability of MFIs. Thus, the socially oriented MFIs, in order to remain sustainable, start targeting the less poor borrowers. But the other view holds that as competition intensifies, it provokes the MFIs to remain committed with the social objective and to strive to retain the clients. The theory on impact of competition on the social performance of MFIs may be either positive or negative, which calls for further investigation. Against this backdrop, this article attempts to assess the impact of competition on social performance of MFIs in India and Bangladesh. The study is conducted over 53 MFIs from India and 20 MFIs from Bangladesh on which a complete set of data is available. The study period is confined to 9 years from 2009 to 2017. In order to establish the association between competition and MFIs’ social performance, panel data regression is used. The study takes into account the depth and breadth of outreach as the dependent variable. The study uses panel data regression to establish the association between competition and social performance of MFIs. The empirical analysis reveals that competition has no significant association with any of the measures of social performance. This implies that social performance in the sector is explained by other factors. Amongst the country-specific variables, it is clear from analyses that gross domestic product (GDP) and inflation are important determining factors of MFIs’ social performance. Country of origin (COO) of the MFIs is one of the determining factors for social performance as it is found to be significant for three out of the four models. It is also evident from the analyses that Bangladeshi MFIs have a greater impact on MFIs’ social performance in terms of outreach in comparison to Indian MFIs. While for percentage of female borrowers (PFB), Indian MFIs account for greater depth of outreach in comparison to Bangladesh.
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Chauhan, Swati. "Social and Financial Efficiency: A Study of Indian Microfinance Institutions." IIM Kozhikode Society & Management Review 10, no. 1 (October 17, 2020): 31–43. http://dx.doi.org/10.1177/2277975220953311.
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Microfinance institutions (MFIs) provides savings, credit, insurance and remittance facilities to more impoverished people without any collateral. MFIs have twin goals: social outreach and financial sustainability. Outreach refers to how many people are served by MFIs while the capacity of MFIs to serve longer is financial sustainability. The social and financial performance of MFIs is the most debatable issue in the Indian microfinance industry. Social efficiency indicates MFIs’ willingness to support a higher number of poorer consumers while financial efficiency indicates how long financial services can be offered to the poor by institutions. The success of these organizations is very critical for the continuity of funding support for donor agencies and the government. Using data envelopment analysis (DEA) techniques this paper calculates the efficiency of Indian NGO–MFIs. The research also uses Tobit regression to estimate the factors of the efficiency of MFIs. The data is taken from the Microfinance Information Exchange for the period 2009 to 2015. Results indicate that NGO–MFIs are financially more efficient than social ones. Regression findings show that the critical variable for the financial and social efficiency of NGO–MFIs is operational self-sufficiency (OSS). Very few empirical studies are available in the Indian context that discuss the efficiency of Indian NGO–MFIs. The present paper provides standards for performance measures of NGO–MFIs operating in India to assist in improving the performance and growth of microfinance firms.
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Dato, Muluneh Hideto, Roy Mersland, and Neema Mori. "Board committees and performance in microfinance institutions." International Journal of Emerging Markets 13, no. 2 (April 16, 2018): 350–70. http://dx.doi.org/10.1108/ijoem-08-2016-0216.
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Purpose The purpose of this paper is to empirically relate subordinate board structures with improved financial and social performance in microfinance institutions (MFIs). Design/methodology/approach The research question is analyzed using a panel data from 23 MFIs in Ethiopia over a period of 2006-2011. Random effects panel data estimation is applied to analyze the link between board committees and MFI’s performance. Findings In MFIs with larger than average boards, the findings demonstrate significant ties between financial and outreach performance and how their boards are structured. The structure of board committees moderates the relation between board size and financial and outreach performance measures. Importantly, board committee benefits MFIs through better operational self-sufficiency, lower operating expenses, greater outreach to customers, and outreach to poorer customers using average loan size as the proxy. Practical implications Practitioners within microfinance sector, and those operating in advisory and regulatory roles to the sector could benefit from the argument advanced in the paper in that normative recommendation to restructure boards or establish committees requires reevaluating the board characteristics vis-à-vis the optimal monitoring, controlling, and advising needs of the institution. Originality/value Prior literature focuses on who sits on boards, how large are the boards, and how independent are they. This paper advances the understanding of the structure of board committees and how this may affect the performance of MFI. This approach provides better representation of director’s role and is thereby a good test of board effectiveness.
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Dube, Hlupeko, and Zvitambo Kudakwashe. "The relevance of corporate governance codes to small and medium enterprises: The case of developing country." Corporate Governance and Sustainability Review 3, no. 1 (2019): 18–24. http://dx.doi.org/10.22495/cgsrv3i1p2.
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The aim of this paper was to examine the relevance of governance codes to Microfinance Institutions (MFIs) in developing counties. The study was motivated by a lack of transparency, sound risk management and sustainability challenges faced by MFIs in developing countries. The study was important for the improvement of governance in MFIs, which are an important tool for the growth, and development of nations. In the paper, a theoretical literature review approach to governance in MFIs was adopted because it allowed the researcher to review critique and synthesize the literature on governance in MFIs. This, in turn, enabled the researchers to generate new frameworks and perspectives on the topic in microfinance. The study found that there was poor governance in Zimbabwean MFIs, governance codes in place were skewed towards large corporations and did not fit the context MFIs. Furthermore, the study established that financial statements for MFIs were not easy to access and the application of corporate governance in MFIs of developing countries was found to be difficult because of inadequate financial resources and lack of knowledge on governance issues. Therefore, the study concluded that corporate governance codes in developing countries needed to be adjusted to the context of MFIs. The study recommends that governance codes that suit the institutional set up of small firms including MFIs in terms of capital structure, ownership concentration and markets should be crafted and adopted. Furthermore, MFIs should implement governance training and increase transparency. The governance codes should be provided free to businesses and be accompanied by extensive training by government and institutions of higher learning.
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Bakker, Anuschka, Jaap Schaveling, and André Nijhof. "Governance and microfinance institutions." Corporate Governance 14, no. 5 (September 30, 2014): 637–52. http://dx.doi.org/10.1108/cg-03-2014-0032.
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Purpose – This paper aims to determine the influence of governance mechanisms on sustainability and outreach of microfinance institutions (MFIs). Corporate governance has been identified as a key bottleneck in strengthening MFIs’ sustainability (financial performance) and increasing their outreach (social impact). Design/methodology/approach – First, a literature study to give insight in the microfinance sector is provided. Subsequently, the data research has been performed based on the statistics of one of the funds of a Dutch independent investment manager, which is focused on responsible investments in developing countries. Hierarchical multiple regression analyses were conducted to examine the association between governance mechanisms and the respective dependent variables. Findings – The results show that boards of a MFI with insiders (for example, employees) are a significant predictor of sustainability. Regulation impacts sustainability significantly in a negative way. Overall, the study shows that only a limited number of variables influence the sustainability and outreach of an MFI. Research limitations/implications – The limitation of the studied investment fund is that it invests in expanding and mature MFI’s. So the results of this research can only be generalized to expanding and mature MFI’s. Practical implications – The governance mechanisms that are recommended in the industry guidelines and which are studied here are often not relevant in respect to sustainability and outreach of MFIs. The approach to microfinance governance should be broadened by focusing more on stakeholders and the decision making process in an MFI. Social implications – Good governance is key for the microfinance institutions and even more complicated than for regular companies that do not have a double bottom line (sustainability and outreach). to be successful in the future, and for clients to reach the best end result, it is essential that the governance mechanisms that influence the bottom line are determined. Originality/value – Not much research has been done with respect to the governance mechanisms, which have impact on the sustainability and outreach of MFIs.
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Kar, Santa, and Joyeeta Deb. "Efficiency Determinants of Microfinance Institutions in India: Two Stage DEA Analysis." Central European Review of Economics and Management 1, no. 4 (December 29, 2017): 87. http://dx.doi.org/10.29015/cerem.528.
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Aim: In India, Microfinance Institutions (MFIs) emerged as major player in providing microfinance services and therefore such institutions need to be financially sustainable in order to achieve their double bottom-line objective. Besides, Indian MFIs cannot protect themselves from the curse of loan non-repayment. Therefore, this study aims to measure performance of the Indian MFIs and examine whether sustainability has any significant impact on the efficiency of the MFIs. Design / Research methods: In order to gauge the performance of the Indian MFIs, non parametric Data Envelopment Analysis (DEA) is adopted. Two models of DEA (BCC Model-input oriented and Undesirable Measure Model-output oriented) are applied used for better analysis. Further, to examine the factors influencing efficiency of the MFIs and particularly to answer whether Sustainability has any significant impact on efficiency, Tobit regression is applied in the study. Data of thirty-one Indian MFIs for seven years (2009-2015) are collected from MiX Market for the study. Conclusions / findings: Result of the study shows that average technical efficiency of the MFIs is estimated to be 79 percent under BCC model and 98 percent under Undesirable Measure Model. Indian MFIs can attain production frontier if they can trim their bad output (proxied by Portfolio at Risk 30) to an extent of around 14 percent. Further, the study validates that sustainability (proxied by Operational Self Sufficiency) has positive impact on efficiency. Originality / value of the article: Studies made so far on Indian MFIs have not addressed how the MFIs could become efficient by reducing their undesirable/bad output. Besides, no study so far has analysed the impact of sustainability on efficiency of the Indian MFIs. Therefore, this research tries to fill the existing research gap. Implications of the research: The result of the study can be useful to the Indian Microfinance Industry in improving their performance. The result can further be used by Reserve Bank of India (RBI) to frame yardstick for the clients of the MFIs in connection with borrowing loans from MFIs.
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Kyereboah-Coleman, Anthony. "The determinants of capital structure of microfinance institutions in Ghana." South African Journal of Economic and Management Sciences 10, no. 2 (April 9, 2013): 270–79. http://dx.doi.org/10.4102/sajems.v10i2.587.
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Using a panel data methodology, this study examines the determinants of capital structure of 52 microfinance institutions (MFIs) in Ghana. The empirical results show that the MFIs are highly leveraged and that their capital structure is explained partly by standard finance theory and by other unconventional variables. Specifically, the study confirms that leverage is positively related to asset tangibility, with small MFIs using short-term and large MFIs using long-term debt. Though, the findings confirm that leverage is inversely related to risk, they also suggest that some MFIs enjoy long-term debt in spite of risk, while profitability is irrelevant in explaining the capital structure decisions of MFIs. Finally, the study shows that the reputation and board independence of MFIs significantly and positively affect their capital structure decisions.
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Chaulagain, Krishna Prasad, and Basu Dev Lamichhane. "Determinants Factors of Microfinance Performance in Nepal." Journal of Nepalese Business Studies 15, no. 1 (December 28, 2022): 46–59. http://dx.doi.org/10.3126/jnbs.v15i1.50380.
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This study concerns the key factors of performance of the Nepalese microfinance institutions (MFIs). The principal goal of the study is the identification of necessary operational performance of MFIs. The determinants influencing MFIs' performance were identified using descriptive, correlational, and casual-comparative study methodologies. The study's conclusions demonstrated a strong correlation between MFIs performance and information technology, loan lending processes, and regulatory environment. The regulatory Framework seems to be an important factor in Nepal's microfinance performance as well. The study also discovered that MFIs performance is significantly influenced by the loan lending system, regulatory environment, and information technology. The study discovered that the loan lending system, regulatory framework, information technology, loan lending system, employee motivation, management system, effective risk management, and regulatory framework have a positive link with the performance of MFIs and significantly affect it. Additionally, it shows that the operational effectiveness of MFIs in Nepal has no correlation with employee motivation, management system, and effective risk management. The study's findings will be helpful to all parties involved with MFIs, including investors, regulators, legislators, and BFIs. According to the outcome, operational efficiency significantly affects the viability and continuation of service of Nepalese MFIs.
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Aguenaou, Samir, Sarah Allouch, Nada El Maliki, and Jawad Abrache. "Financial Performance and Sustainability of Moroccan Microfinance Institutions: An Empirical Study." Accounting and Finance Research 8, no. 4 (October 15, 2019): 144. http://dx.doi.org/10.5430/afr.v8n4p144.
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This study explores the determinants of the financial performance and sustainability of Moroccan Microfinance Institutions (MFIs). Through the use of panel data concerning 10 MFIs (available on the MIX platform) with different time frames, three OLS models are run and aim to explain MFIs financial performance and sustainability using independent variables related to the size of the MFIs, the quality of their loan portfolios, the degree of outreach, and their productivity. The results obtained show that: (1) the personnel productivity contributes significantly to the MFIs’ Return on Assets and their sustainability, and (2) the loan repayment level of MFIs customers is an important determinant of their sustainability.
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HAINI, HAZWAN, and ZOË ANASTASIOU. "THE DETERMINANTS OF MICROFINANCE INSTITUTIONS EFFICIENCY: THE ROLE OF WOMEN BORROWERS." Journal of Business and Economic Analysis 04, no. 02 (December 2021): 95–117. http://dx.doi.org/10.1142/s2737566821500067.
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Microfinance institutions (MFIs) are instrumental in enabling the economic empowerment of women. We examine the efficiency and performance of 84 Indian MFIs from 2016 to 2018 using a two-stage double bootstrap approach. Our results show that MFIs with increased outreach and actively target female borrowers achieve higher efficiency. Furthermore, we find larger MFIs and higher leverage intensity to be positively associated with efficiency. Government policies should be encouraged to support current MFIs to grow larger, actively target female borrowers and increase outreach to the poor to support India’s financial inclusion agenda and facilitate the economic empowerment of women whist revitalizing less efficient MFIs.
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Gan, Christopher, and Wittawat Hemtanon. "Sustainability of Microfinance Institutions in Thailand." Asian Journal of Agriculture and Development 19, no. 1 (June 28, 2022): 77–90. http://dx.doi.org/10.37801/ajad2022.19.1.5.
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Microfinance programs play a vital role in poverty alleviation in developing countries; however, most microfinance institutions (MFIs) face the challenge of maintaining financial sustainability. While several studies have investigated factors affecting MFI financial sustainability, only a few focus on MFIs in Thailand. This paper uses the random effect model to study the determinants of Thai MFIs’ financial sustainability. Results show that sustainability is affected by the efficiency of Thai MFI staff members in managing borrowers and the MFIs’ ability to use their short-term assets to generate cash or revenue. Moreover, Thai MFIs do not benefit from economies of scale and do not reach the very poor households. This study recommends that MFIs should ensure that their social and financial goals are adequately balanced. It proposes that MFIs use a mixed approach: follow profit maximization principles and embrace technology to minimize operational costs.
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Njuguna, Dr James Rurigi, Prof Roselyn Gakure, Dr Anthony Gichuhi Waititu, and Dr Paul Katuse. "FINANCIAL RISK MANAGEMENT STRATEGIES AND THE GROWTH OF MICROFINANCE SECTOR IN KENYA." Journal of Accounting 2, no. 1 (March 1, 2017): 23–53. http://dx.doi.org/10.47941/jacc.118.
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Purpose: The purpose of this study was to investigate how financial risk management strategies lead to growth of MFI sector in Kenya.Methodology: The study adopted a correlation survey research design. The population of this study was fifty seven (57) MFIs. The sampling frame was the list of MFIs provided in the AMFI website www.amfikenya.com. A sample of thirteen (17) MFIs was selected using the random sampling approach. A questionnaire and an interview schedule were the main data collection tools. Qualitative data was analyzed using content analysis whereas the quantitative data was analysed using Statistical Package for Social Sciences (SPSS) where descriptive and regression analysis were conducted to determine the relationship between enterprise risk management strategies and growth of MFIs.Findings: The findings indicated that MFIs had effective financial risk management strategies such as effective credit risk management practices, liquidity risk management practices, interest risk management practices and price risk management practices. In particular, MFIs took into consideration the conditions, characters, capacity, collateral and capital of borrowers. Strict debt collection practices were widely adopted by MFIs. In addition, the concept of Know Your Customer (KYC) policy, seem to have been adopted by MFIs. The relationship between financial risk management strategies and growth was positive and significant. It also shown that sources of funds for MFIs include external sources and internal sources and the most frequently used source of funds are bank loans. The use of banks loans may present various risk exposures to MFIs, the most significant being interest rate risk. However, the ability of MFIs to source funds from various sources indicates that MFIs can apply the pecking order by first exploiting internal sources of funds since they present a lower financial risks and then move on to external sources. However, despite the financial risk exposure accompanied by leverage from external sources, MFIs may also benefit as they may experience higher growth driven by the leverage. It was also found that MFIs had put in place a number of good practices that had emerged to promote responsible and inclusive lending. These include loan size limits, standardized (simple) loan terms, zero tolerance on delinquency, group-based lending. This finding implies that MFIs have put in place effective credit risk management policies which are part of an overall financial risk management strategy. The existence of effective financial risk management practices may have influenced the growth of MFIsUnique contribution to theory, practice and policy: The study recommends that the MFIs to continue practicing effective financial management practices as this would improve the growth of MFIs.
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Bayai, Innocent, and Sylvanus Ikhide. "Financing structure and outreach of selected SADC microfinance institutions (MFIS)." Corporate Ownership and Control 13, no. 3 (2016): 284–92. http://dx.doi.org/10.22495/cocv13i3c2p3.
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This paper probes the link between financing structure and outreach noting the commercialization trend for selected Southern Africa Development Community (SADC) MFIs. Assuming MIX panel data on 60 MFIs, this study tackles outreach depth and breadth – a diversion from an outreach depth-centered study which employed Planet Rating data on 74 Sub-Saharan African MFIs. Robust panel methods show that, both outreach depth and breadth are affected by the same variables, though in a different way. Equity, deposits and ‘new’ MFIs significantly further depth whilst borrowings limit depth. Breadth is constrained by borrowings, equity and ‘new’ MFIs while deposits expand the breadth. We suggest that, permitting MFIs to collect deposits go a long way in spurring outreach depth and breadth.
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Wu, Pingping, and Yongfeng Liang. "Enhanced Reversible Magnetic-Field-Induced Strain in Ni-Mn-Ga Alloy." Metals 11, no. 12 (December 13, 2021): 2017. http://dx.doi.org/10.3390/met11122017.
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A phase-field model was developed to simulate the ferromagnetic domain structure and martensite variant microstructure of Ni-Mn-Ga shape-memory alloy. The evolution of reversible magnetic-field-induced strain (MFIS) and associated magnetic domain/martensite variant structure were modeled under an external magnetic field. It was found that MFIS increased significantly from 0.2% to 0.28% as the temperature increased from 265 K to 285 K. In addition, compressive pre-stress efficiently enhanced the MFIS of the alloy, while tensile stress reduced MFIS. Furthermore, it was proved that there was possibility of achieving similar enhancement of MFIS by replacing compressive stress with perpendicular biaxial tensile stress. The results revealed that the residual variant induced by stress plays an important role in the reversible MFIS effect.
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Hashim, Maryam Jameelah, Nur Afizah Muhamad Arifin, Mohd Faizal Kamarudin, and Rahim Khamis. "Intellectual capital components and its relationship to Microfinance institutions’ performance." ADVANCES IN BUSINESS RESEARCH INTERNATIONAL JOURNAL 6, no. 2 (October 31, 2020): 69. http://dx.doi.org/10.24191/abrij.v6i2.10853.
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In a majority of banking and non-banking institutions, intellectual capital (IC) is one of the prominent factors that contributes to the development of knowledge-based economy and increase in competitiveness. However, there is an ambiguity in whether a firm’s precious resources could guarantee the success of new strategies. Thus, this study was undertaken to examine the significant effect of intellectual capital on the performance of MFIs. This study also examined whether the MFIs specification could have a moderating effect on the relationship between intellectual capital and MFIs’ performance. The current study used the PLS-SEM to analyze the research model and found that it explains 43.6 % of the substantial amount of variance in the performance of MFIs. Theoretically, the study extends the resource-based view (RBV) in projecting the MFIs’ performance. The empirical results show that there is a significant relationship between IC and MFIs’ performance for both banking and non-banking MFIs.
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Koti, Kundai, and Florah Sewela Modiba. "The role of microfinance institutions in enhancing the sustainability of women-owned SMMES." Investment Management and Financial Innovations 19, no. 2 (July 1, 2022): 306–19. http://dx.doi.org/10.21511/imfi.19(2).2022.27.
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Microfinance plays a catalytic role in the sustainability of small, micro, and medium enterprises (SMMEs). Given the prevailing failure rate of SMMEs in South Africa, a holistic view of microfinance institutions (MFIs) regarding microfinance is essential. This paper explores how MFIs enhance women-owned SMMEs’ sustainability in the Gqeberha area focusing on three MFIs subsidized by the South African government in Nelson Mandela Bay municipality. Systems theory was used to explore areas that MFIs should focus on to enhance the sustainability of women-owned SMMEs. A qualitative case study using semi-structured interviews and open-ended questionnaires was employed. The research sample was drawn from three public MFIs in Gqeberha and 21 women-owned SMMEs who are beneficiaries of the MFIs. Coding and thematic analysis were used for data analysis. MFIs encounter challenges in adequately servicing women-owned SMMEs. A mismatch was identified in the provision and demand of microfinance services due to limited funding for MFIs. The non-financial support essential to keeping SMMEs afloat does not meet the needs of women-owned businesses. The microfinance services provided by MFIs play a significant role in supporting SMMEs to achieve sustainability. However, there is a need for a complementary service that should offer sector-specific business support because current services provided by the MFIs are generic, and SMMEs need sector-specific assistance. AcknowledgmentsOur special thanks go to the Department of Development Studies and Nelson Mandela University for the support that contributed to the success of this manuscript. We also acknowledge Dr. Ruth Albertyn for her technical and editorial support.
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Bhanot, Disha, and Varadraj Bapat. "Sustainability index of micro finance institutions (MFIs) and contributory factors." International Journal of Social Economics 42, no. 4 (April 13, 2015): 387–403. http://dx.doi.org/10.1108/ijse-01-2014-0001.
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Purpose – The purpose of this paper is to conceptualize the sustainability of micro finance institutions (MFIs) in a holistic manner. The idea is to create an index of sustainability for MFIs which includes financial and outreach aspects of sustainability. Further, it also discerns the factors which contribute to high (low) sustainability scores of MFIs. Design/methodology/approach – Data on Indian MFIs was collected from Microfinance Information Exchange database. Using the technique of order preference by similarity to ideal solution (TOPSIS), an Index of sustainability is built by aggregating multiple indicators (operational self-sufficiency ratio, the average loan balance per borrower and the number of active borrowers) to arrive at composite sustainability score of MFIs. Contributory factors of sustainability were identified using a multiple regression model. Findings – The sustainability score for MFIs ranges from a maximum score of 0.80 to a minimum of 0.26. Gross loan portfolio, No. of borrower per staff member, portfolio at risk>30 days and return on assets, are significant contributors to sustainability scores of Indian MFIs. Practical implications – The index of sustainability is a useful tool to rank the MFIs on a multi-dimensional construct of sustainability. The study also helps to unravel factors that significantly contribute to sustainability of Indian MFIs. Originality/value – This study is novel in its attempt to measure sustainability in a holistic fashion by focussing not just on the financial performance of the MFI but also on outreach dimensions. It is also unique in its approach to adopt a multi criteria decision-making technique of TOPSIS to measure sustainability of Indian MFIs.
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Hashim, Maryam Jameelah, Syed Musa Alhabshi, and Nor Irvoni Mohd Ishar. "Does Intellectual Capital Explain the Financial Performance of Malaysia MFIs?" Social and Management Research Journal 15, no. 2 (December 3, 2018): 1. http://dx.doi.org/10.24191/smrj.v15i2.4967.
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The performance of microfinance institutions (MFIs) is crucial for ensuringthe efficient utilisation of funds deposited into the microfinance programmeby donors, as well as for assisting regulators in monitoring the institutions.Assessing the performance of MFIs involves examining its developmenttowards accomplishing its goals. Therefore, MFIs need to ascertain thechallenges to maintain their sustainability and sustain their operations.Additionally, MFIs should focus on aspects such as intellectual capital(IC) to ensure future sustainability. The aim of this research is to examinehow IC dimensions, specifically, customers, structure, human, and socialcapital, influence MFIs performance. A cross-sectional survey design wasused to gather data from 145 managers (48% response rate) from MFIs inMalaysia. In order to determine the sample size of the study, a purposivesampling method was employed. The research model was analysed byusing Partial least square-structural equation (PLS-SEM). Subsequently,the research model was validated using Smart PLS 3.2.5 and the proposedstudy hypothesis. The findings confirm that structural capital and customercapital positively influence the performance of MFIs, except for social andhuman capital. The research model explains 67.6% of the substantial amountof variance in MFIs performance. This research theoretically contributesto the extension of resource-based view (RBV) and social capital theory inDoes Intellectual Capital Explain the FinancialPerformance of Malaysia MFIs?Maryam Jameelah Hashim1, Syed Musa Alhabshi1, Nor Irvoni Mohd Ishar21Islamic Banking and Finance, International Islamic University Malaysia2Faculty of Business & Management, Universiti Teknologi MARA, Puncak Alam,Selangor, MalaysiaE-mail: jamieniz@yahoo.com, syedmusa@iium.edu.my, irvoni@salam.uitm.edu.myReceived: 5 June 2018Accepted: 18 September 20182Social and Management Research Journalpredicting the sustainability of MFIs. All the factors of IC were confirmed toimprove the performance of MFIs. This study proposed several remarkablerecommendations for microfinance institutions which suggested that MFIs’managers should resolve their organisational issues promptly. Furthermore,they should portray sensible consideration for their institutions by takingcare of IC and encouraging the practice of recognising intangible assets,especially their employees’ expertise and capabilities.
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Disemadi, Hari Sutra, and Ayup Suran Ningsih. "EFFORTS TO PROTECT CONSUMER’S SPIRITUAL RIGHTS IN ORGANIZING ISLAMIC MICROFINANCE INSTITUTIONS IN INDONESIA." Diponegoro Law Review 5, no. 2 (October 30, 2020): 172–87. http://dx.doi.org/10.14710/dilrev.5.2.2020.172-187.
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Microfinance Institutions (MFIs) are part of non-bank financial institutions. In organizing, MFIs can be implemented with sharia principles, but not a few people who assume that this Sharia-based MFI is only a label to attract the sympathy of the Muslim community. Based on this, this study aims to determine the legal policies for the implementation of MFIs in Indonesia and to find out regulatory policies regarding sharia principles in the organization of MFIs as an effort to protect the spiritual rights of consumers. This study uses a normative juridical research method with a conceptual approach and a statutory approach. This study shows the legal basis for the organization of MFIs is Law Number 1 of 2013, POJK Number 14/POJK.05/2014, POJK Number 61/POJK.05/2015, and POJK Number 62/POJK.05/2015. The policy of regulating the application of sharia principles as an effort to protect the spiritual rights of consumers has also been regulated in the MFI Law and the implementing regulations namely POJK Number 62/POJK.05/2015 concerning Business Administration of MFIs which in the implementation of sharia-based MFIs must use mudharabah, musyarakah, murabahah, ijarah, salam, istishna, ijarah muntahiah bit tamlik or other contracts (akad) that do not conflict with sharia principles. The policy of applying sharia principles in organizing MFIs is intended to guarantee the protection of the spiritual rights of consumers from Islamic MFIs.
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Xu, Wei, Hongyong Fu, and Huanpeng Liu. "Evaluating the Sustainability of Microfinance Institutions Considering Macro-Environmental Factors: A Cross-Country Study." Sustainability 11, no. 21 (October 25, 2019): 5947. http://dx.doi.org/10.3390/su11215947.
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Microfinance institutions (MFIs) have attracted great attention, due to their significant role in poverty reduction. Given the features of MFIs, this paper proposes a novel hybrid model of soft set theory, and an improved order preference by similarity to ideal solution (HMSIT) to evaluate the sustainability of MFIs, considering accounting ratios, corporate governance factors, and macro-environmental factors, from a cross-country perspective. This setting enables the examination of the role of macro-environmental factors in the sustainability of MFIs. For this purpose, soft set theory is adopted to select optimal criteria. An improved order preference by similarity to ideal solution method, in which the weight of each criterion is determined by soft set theory, is proposed to rank the sustainability of MFIs. This algorithm enables HMSIT to make full use of various types of information. The case study uses cross-country samples. Results indicate that macro-environmental factors are significant in evaluating the sustainability of MFIs from a cross-country perspective. Particularly, they can play a key role in distinguishing MFIs with low sustainability. The results also indicate that HMSIT has strong robustness. Ranked results, produced from the proposed HMSIT are reliable enough to provide some managerial suggestions for MFIs and help stakeholders make decisions.
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Quartey, Joyce Ama, and Bernice Kotey. "Effect of Regulation on Outreach of Microfinance Institutions in Ghana." International Journal of Accounting and Financial Reporting 9, no. 1 (January 3, 2019): 317. http://dx.doi.org/10.5296/ijafr.v9i1.14405.
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Microfinance institutions (MFIs) play an important role in enhancing the growth potential of small businesses. However, while regulation ensures that MFIs are financially sustainable, compliance compels them to make large-sized loans to wealthy clients in order to reduce the risk of lending and minimize administrative costs, a situation that compromises their main goal of reaching out to the poor. The study therefore, examined the effect of regulation on breadth and depth of outreach by microfinance institutions (MFIs) in Ghana. The purpose of the study is to find out whether regulation has enabled MFIs to increase their outreach (breadth and depth) thereby improving their sustainability. A mixed methods research design was employed, involving initial hypotheses testing with 31 self-regulated and 24 Central bank-regulated MFIs. The findings were then triangulated with a qualitative research design involving 13 Central bank-regulated and 20 self-regulated MFIs. The results showed that regulations increased the client base of MFIs but reduced the percentage of poor clients served, largely women. It is recommended that the government set up a fund for poor clients to be accessed by well-performing MFIs for provision of financial services to the poor to assist in poverty reduction.
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Bergsma, Kelley. "Does Offering Microsavings Make Sense for Microfinance Institutions?" American Economist 56, no. 2 (November 2011): 15–27. http://dx.doi.org/10.1177/056943451105600204.
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Within the past decade, two trends have emerged in the global microfinance industry. First, there has been a recent emphasis on financial sustainability. At the same time, microfinance institutions (MFIs) have begun to offer microsavings deposit services to their clients. Could there be a link between these two trends? As MFIs offer savings deposits, do they achieve greater financial sustainability? David Hulme (2008) asserts that Grameen Bank became more financially sustainable after it changed its business model to include microsavings. However, Hulme observes that Grameen Bank also moved away from its poorest clients when it made the shift to savings. This paper explores, as MFIs have switched to offering savings, whether or not MFIs have achieved greater financial sustainability and whether or not they have moved away from their poorest clients. The data examined were collected from the financial statements of Opportunity International MFIs. The results indicate that Opportunity International MFIs that offer microsavings are more financially sustainable than those that do not. Moreover, there is no significant evidence that, by offering microsavings, Opportunity International MFIs have abandoned their poorest clients. Opportunity International MFIs could provide a model of how microfinance institutions can improve their financial sustainability without compromising their core mission to serve the poor.
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Ambarkhane, Dilip, Ardhendu Shekhar Singh, and Bhama Venkataramani. "Measuring total factor productivity change of microfinance institutions in India using Malmquist productivity index." Indian Growth and Development Review 12, no. 1 (April 8, 2018): 105–30. http://dx.doi.org/10.1108/igdr-12-2017-0105.
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PurposeMicrofinance institutions (MFIs) provide small loans and other financial services to the poor. These institutions are established for helping the poor to raise income levels and to reduce poverty. Recently, MFIs are required to reduce their dependence on grants and subsidies. Consequently, they face conflicting objectives of improving reach and profitability. These can be achieved by improving productivity. This paper aims to investigate productivity change in 21 major MFIs in India which are rated by Credit Rating and Information Services of India Limited in 2014.Design/methodology/approachThis paper attempts to examine total factor productivity change in 21 major Indian MFIs during the period from 2014 to 2016 using Malmquist productivity index. The inputs and outputs are selected considering objectives of outreach and financial sustainability. The authors have categorized MFIs in three categories, namely, large, medium and small, depending on asset size.FindingsIt is revealed that large MFIs are able to catch up with industry best practices by improving their systems and processes, but they need to improve scale efficiency. The Reserve Bank of India has recently initiated a policy of granting banking licenses to those financial institutions which have good outreach and are financially strong. It can be used for shortlisting MFIs before granting permission to operate as banks. The method can also be used for benchmarking them for productivity. It can also be replicated in other countries.Originality/valueIn India, MFIs are playing important role in economic development by providing microcredit to the poor. However, very few studies have been undertaken regarding productivity of MFIs in India. The present study intends to fill this gap. It will facilitate benchmarking of MFIs as competitive and sustainable financial institutions catering to the requirements of small borrowers.
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Iqbal Hussain, Hafezali, Fakarudin Kamarudin, Nazratul Aina Mohamad Anwar, Fadzlan Sufian, Azlan Ali, and Mohd Haizam Saudi. "Social Globalisation and Efficiency of Microfinance Institutions Nexus: Empirical Evidence on Financial and Social Efficiency." Engineering Economics 33, no. 1 (February 28, 2022): 27–46. http://dx.doi.org/10.5755/j01.ee.33.1.29130.
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The main objective of this paper is to identify the impacts of social globalisation comprised of personal contacts, information flows and cultural proximity to the financial and social efficiency of Microfinance Institutions (MFIs). This study had conducted two stages of analysis, in which the first stage is Data Envelopment Analysis (DEA) approach and the second stage is multiple panel regression analysis under Generalized Least Square estimation method. The results exhibit that the overall MFIs operated in a relatively optimal scale during the period of the study. However, these MFIs were managerially inefficient in utilising their resources to achieve both social and financial efficiency. The results from panel regression analysis showed that only personal contacts exhibit a significant positive relationship with the financial efficiency of MFIs. This study could contribute new insights and implications to various parties, such as MFIs, policy makers, investors and researchers to improve the efficiency of MFIs.
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Sekabira, Haruna. "Capital Structure and Its Role on Performance of Microfinance Institutions: The Ugandan Case." Sustainable Agriculture Research 2, no. 3 (March 15, 2013): 86. http://dx.doi.org/10.5539/sar.v2n3p86.
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<p>Micro Finance Institutions (MFIs) rejuvenate economic prowess in developing countries, after severe shocks like wars, droughts and floods. MFIs are a promising tool to tackle poverty and improve food security. Sustainability of MFIs based on their capital structure ensures sustainability in poverty reduction and improved food security. The limited literature on the impacts of capital structures on MFI performance necessitated the study. Panel data from 14 MFIs was collected based on availability and accessibility. The sources of data were financial and income statements covering five years. Econometric analysis using STATA software was done following methodologies of Bogan and Rosenberg. MFIs lent to both individuals and groups and 79% were not regulated by the Central Bank, 86% had their funding sources as loans, grants, excluding deposits/savings and 73% attained operational self-sufficiency. Debt and grants were negatively correlated to operational and financial sustainability. When sustainability was more constricted to financial sustainability, debt and share capital remained noteworthy. Other than grants, debt was paid back on competitive market interest rates most especially debts from money lenders, whereas share capital fetched in revenues to the MFIs at market interest rates from the borrowers. Grants and debt had a substantialdamagingconsequence on MFI performance. Capital structure was essential in MFIs’ sustainability. MFI specific characteristics, like management were also important. Subject to sampling uncertainties, the results indicate that adding to regulation by Central Bank, MFIs must specialize their lending to reduce portfolio at risk. MFIs must reduce dependence on debts and grants and resort to accumulating share capital for long-term sustainability.</p>
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LOPES, Josiane, Hayslenne Andressa Gonçalves de Oliveira ARAÚJO, and Suhaila Mahmoud SMAILI. "Fatigue in Parkinson’s disease: Brazilian validation of the modified fatigue impact scale." Arquivos de Neuro-Psiquiatria 78, no. 8 (August 2020): 473–80. http://dx.doi.org/10.1590/0004-282x20200033.
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ABSTRACT Background: The instruments that measure the impact of fatigue on physical, cognitive and psychosocial aspects has yet to be validated in Brazilian population with Parkinson’s disease (PD). The aim of this study was to cross-culturally adapt and assess the psychometric properties of the Brazilian version of the Modified Fatigue Impact Scale (MFIS-PD/BR). Methods: Ninety PD individuals were recruited. The adaptation of the MFIS-PD was performed by translation and back translation methodology. Psychometric analysis was applied in order to perform the administration of the socio-clinical questionnaire, Mini-Mental State Examination (MMSE), Unified Parkinson’s Disease Rating Scale (UPDRS Part I-IV), Hoehn-Yahr disability scale (HY), hospital anxiety and depression scale (HADS), Geriatric Depression Scale (GDS), fatigue severity scale (FSS), Parkinson Fatigue Scale (PFS-16), and MFIS-PD/BR with retest of the MFIS-PD/BR after 7 days. Results: The adaptation phase kept the same items of original MFIS-PD. The Cronbach’s alpha for the MFIS-PD/BR was 0.878 when all responses items were scored. The test-retest intraclass correlation coefficients was above 0.80 (p<0.01) for the MFIS-PD/BR score, which was moderately correlated with the HADS, GDS, MDS-UPDRS score total and non-motor experiences of daily living, FSS and PFS-16. It was revealed the MFIS-PD/BR>29 points as cut-off point to indicate fatigued subjects with accuracy of 0.835 (p<0.001). Conclusions: The MFIS-PD/BR is valid and reproducible to use in assessing the fatigue symptom in Brazilian PD subjects.
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ALMASE, Veronica. "Microfinance Institutions (MFIs) Intervention in Poverty Alleviation of Households in Lopez, Quezon Province, Philippines." Psychology and Education Journal 58, no. 1 (January 15, 2021): 3625–31. http://dx.doi.org/10.17762/pae.v58i1.1350.
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This paper investigates Microfinance Institutions (MFIs) Intervention in poverty alleviation of households in the locality of Lopez, Quezon province, Philippines. It focuses on five specific objectives to: Determine the personal profile of MFIs household members, their membership profile, examine the goal congruence between MFIs and households, investigate the circumstances during MFIs intervention and, finally find out threats in availing loans from MFIs. This paper adopts quantitative type of research primarily the descriptive questions survey where 117 were considered as the representative sample of MFIs in the municipality. Likewise, purposive sampling was used in the determination of samples and survey form for data collection. This study utilized the SPSS to generate the frequency distribution and weighted mean. It was revealed in the analysis that microfinance interventions that offer both savings and loans contributed to a higher standard of living of households. More so, the results show that microfinance institutions provide supplemental income for families which may adhere to basic family needs, health, education, and lessen debts to specific persons. Therefore, It was found out that both microfinance savings and microfinance credit appreciably and undoubtedly changed the conditions of every household after availing the MFIs services. The study recommends that MFIs should continuously pay closer attention on their interventions that will provide assistance that are favorable to the welfare of every member and the society as well.
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Niti Bhasin and Preeti Gupta. "Drivers of Sustainability of Indian Microfinance Institutions." Think India 19, no. 3 (December 12, 2016): 1–16. http://dx.doi.org/10.26643/think-india.v19i3.7778.
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Microfinance is the most preferred way of satisfying the essentials of poor which are generally not taken care of by formal financial institutions. It is the way to facilitate them to uphold self-employment through various financial services like provision of funds, insurance, credit etc. Microfinance institutions cater to the need of major section of society by providing access to funds and other financial services, which basically lack access to these services. To accomplish this moral objective microfinance institutions (MFIs) need to be profitable and sustainable. Thus most important question arises is: what factors drive the sustainability of MFIs. The aim of microfinance is to alleviate poverty with the help of increasing access to finance. For well-being of the poor, good sustainable performance of MFIs must be achieved. Therefore, the present study attempts to explore different factors which might affect sustainability of Indian MFIs. Panel regression analysis is used to identify the determinants of sustainability of Indian MFIs. Due to non-availability of data for most of the MFIs, five years (2009-2013) data for 46 MFIs shall constitute our sample size. Results of the study exhibit that variables such as average loan balance, borrowers per staff member, return on asset, and yield on gross loan portfolio are major determinants of sustainability (financial and operational sustainability) of Indian MFIs.
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Chen, Feng, Zhiyong Gao, Wei Cai, and Lian Cheng Zhao. "The Stability of Magnetic-Field-Induced Strain in a NiMnGa Ferromagnetic Shape Memory Alloy." Materials Science Forum 475-479 (January 2005): 2025–28. http://dx.doi.org/10.4028/www.scientific.net/msf.475-479.2025.
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The stability of magnetic field induced strain (MFIS) in Ni52Mn24Ga24 single crystal under temperature and magnetic field cycling is investigated and the corresponding micro-mechanism is also discussed. It shows that the saturated MFIS is very sensitive to temperature. Below martensitic transformation temperature(Tm), with increasing temperature, the saturated MFIS increases almost linearly. Besides, the saturated MFIS initially decreases with increasing the field cycling number less than four times, then does not change with further increasing the number of field cycles. The decrease of saturated MFIS can be attributed to the decrease of twin boundary mobility, which is related to the crystal defect introduced by immigration of twin boundary under field cycling.
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Pavan, Karina, Kizi Schmidt, Bruna Marangoni, Maria Fernanda Mendes, Charles Peter Tilbery, and Sergio Lianza. "Esclerose múltipla: adaptação transcultural e validação da escala modificada de impacto de fadiga." Arquivos de Neuro-Psiquiatria 65, no. 3a (September 2007): 669–73. http://dx.doi.org/10.1590/s0004-282x2007000400024.
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OBJETIVO: Adaptação transcultural e validação da escala modificada de impacto de fadiga (MFIS-BR). MÉTODO: A MFIS foi traduzida para língua portuguesa e retrovertida para o inglês. Dois estudos piloto foram realizados até ser obtida a MFIS-BR, que foi aplicada em 57 pacientes com esclerose múltipla e 45 controles. O reteste foi 30 dias depois. RESULTADOS: Na análise estatística a reprodutibilidade da consistência interna foi semelhante à escala original (0,74-0,86). A MFIS-BR mostrou-se capaz de identificar os diferentes grupos. Com respeito à reprodutibilidade o coeficiente de correlação interclasses mostrou excelente concordância (0,264-1,0). CONCLUSÃO: A MFIS-BR preenche os critérios de aplicabilidade e sensibilidade de forma semelhante à escala original.
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Wassie, Solomon Bizuayehu, Hitoshi Kusakari, and Masahiro Sumimoto. "Performance of Microfinance Institutions in Ethiopia: Integrating Financial and Social Metrics." Social Sciences 8, no. 4 (April 11, 2019): 117. http://dx.doi.org/10.3390/socsci8040117.
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Since their inception in the 1970s, microfinance institutions (MFIs) have received increasing attention both from policymakers and academic circles. Using unbalanced panel data (2000–2017) from Ethiopia, in this paper, we investigated the performance of MFIs and its determinants on the one hand and whether or not mission drift exists on the other hand. To this end, we employed seemingly unrelated regression (SUR) and fixed/random effect panel models. The results indicate that, based on different outreach and financial performance metrics, the MFIs in Ethiopia have good performance compared with those of the 10 biggest economies in Sub-Saharan Africa (SSA). The econometric estimation results show that asset holding and the yield on gross portfolio have a positive and significant effect on the social and financial performances of MFIs in Ethiopia. Furthermore, the number of loan officers, loan officer productivity, and personnel productivity have a positive and significant impact on the financial performance of MFIs. Our results also suggest that the null hypothesis—that MFIs are not shifting away from poorer clients—cannot be rejected, implying that there is no mission drift by MFIs in Ethiopia.
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Hadžiahmetović, Nejra. "Factors determining the operational self-sufficiency of microfinance institutions." Croatian Review of Economic, Business and Social Statistics 7, no. 2 (December 1, 2021): 1–13. http://dx.doi.org/10.2478/crebss-2021-0006.
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Abstract The main aim of this paper is to explore the factors determining Microfinance institutions (MFIs) self-sufficiency. The data on selected variables for this research were obtained from the public MIX Market Database and cover the year of 2017. The empirical model is constructed with application of a Principal Component Analysis (PCA) and Logistic regression analysis. Sample is consisted of 342 MFIs from all around the world, with 21 independent variables grouped into eight factors/components, and OSS (operational self-sufficiency) as dependent variable. The obtained results suggest that higher revenue and MFIs profitability combined with decrease of credit risk lead to higher probability of MFI to be self-sufficient. These results also confirm widespread belief that MFIs will not be able to achieve their social goals without achieving sustainable profitability. In addition, results also confirm importance of MFIs core mission as with increase in outreach, probability of MFIs achieving self-sustainability also increases.
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Abdullah, Naziruddin. "Measuring the Outreach Level of Micro-finance Institutions in Bangladesh." International Journal of Financial Research 10, no. 5 (June 10, 2019): 280. http://dx.doi.org/10.5430/ijfr.v10n5p280.
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Reaching the poor is one of the main objectives embedded in the programs of microfinance institutions (MFIs). However, there is the question of how well MFIs have fared in terms of meeting this objective, which has been heavily surveyed as an issue by many researchers. In Bangladesh, while not discounting other factors such as the financial assistance received from institutions such as the IMF/World Bank, Asian Development Bank (ADB), and Islamic Development Bank (IDB), the impetus for the speedy reduction in the number of poor people in the country can be attributed to the existence of MFIs. This study attempts to investigate the depth of MFIs’ outreach level in the country. Specifically, using an econometric model, it examines the determinants of the outreach level of MFIs operating in Bangladesh. Overall, this study looks at the eleven (11) biggest MFIs in Bangladesh in terms of their share of active borrowers. The data are compiled from the most reliable sources pertaining to the economic activities of MFIs. The results indicate that the number of years an MFI has spent serving clients, its ratio of borrowers to staff, the size of its assets, and the number of branches all has a positive effect on its outreach level. In contrast, the average loan balance per borrower and cost per borrower have a negative effect on the outreach level of MFIs in Bangladesh. Indeed, as far as outreach level and its relationship with the independent variables are concerned, all of the results obtained in this study are consistent with the expected signs, thereby implying that MFIs in Bangladesh are no different from the conventional wisdom.
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Karmacharya, Sailesh. "A Study of Caste and Gender Barriers for the Operation of Microfinance Institutions (MFIs) in Nepal." Senhri Journal of Multidisciplinary Studies 6, no. 1 (May 10, 2021): 01–14. http://dx.doi.org/10.36110/sjms.2021.06.01.001.
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Micro-finance is used worldwide as an effective tool to reduce poverty through providing financial services to the disadvantaged groups such as low-income people and poor women who are traditionally excluded from such services. Nepal is one of the developing countries that is characterized by pervasive gender and caste bias. This study focused on gender and caste barriers that hinder the smooth implementation of microfinance institutions (MFIs) in Nepal. Using data from semi-structured interviews of ten employees of MFIs and other financial institutions, this study showed that staff of the Nepalese MFIs were aware of caste and gender discriminations, but they were inactive in overcoming these social and cultural barriers in their routine work. The findings indicated that the disproportionate male-female ratio among the staff was a major hindrance in the smooth operation of MFIs. Lack of female staff and the passiveness of female borrowers lead to the problem of communication between MFIs’ staff and their clients. Based on these findings, we suggest that gender sensitive awareness training should be included in MFIs’ training and advocacy programs for staff and clients in Nepal. Equal opportunities should be given to females and low caste people in the process of MFIs’ recruitment.
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Thrikawala, Sujani, Stuart Locke, and Krishna Reddy. "Social Performance of Microfinance Institutions (MFIs): Does Existing Practice Imply a Social Objective?" American Journal of Business and Management 2, no. 2 (May 30, 2013): 173. http://dx.doi.org/10.11634/216796061706285.
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Many microfinance institutions (MFIs) are currently drifting away from their original mission of alleviating poverty. The objective of this article is to identify and update significant social performance (SP) for micro-finance institutions (MFIs) by viewing social performance measures as a way to address the development of MFIs. Unlike traditional performance measurements, social performance measurements are more allied with the organisation’s social and development goals. This study has therefore reviewed prior empirical studies and consultancy reports dealing with poverty alleviation to determine important social performance measurements for MFIs to achieve their social goals. Further, this study scrutinises 415 MFIs that have reported their social performance in the Microfinance Information Exchange (MIX) database in 2008 and 2009. The findings have revealed that from 2008 to 2009 the number of MFIs reporting social performance increased by 72 per cent; 80 per cent of them are Non-governmental Organisations (NGOs) and Non-banking Financial Institutions (NFBIs). This study therefore provides direction for future research in performance assessment, balancing social and financial objectives in the microfinance industry. It is also a step in conducting more research and recommending regulation of the social performance of MFIs that will require them to engage in more empirical research work using micro-econometrics techniques in the future to support the available conceptual literature.
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Ghose, Biswajit, S. Joplinshisha Paliar, and Liha Mena. "Does Legal Status Affect Performance of Microfinance Institutions?: Empirical Evidence from India." Vision: The Journal of Business Perspective 22, no. 3 (July 26, 2018): 316–28. http://dx.doi.org/10.1177/0972262918786104.
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Transformation of non-government organizations (NGOs) to shareholder-owned microfinance institutions (MFIs) is an on-going debate in the field of microfinance research. Institutionalists support the transformation, whereas welfarists argue that NGOs are better conduits in serving poor clients. Prior studies on the impact of legal status of MFIs on their performance document mixed results. This study empirically investigates the extent to which the transformation is justified by examining the impact of legal status on the performance of MFIs in India. Using both univariate ( t-test and rank-sum test) and multivariate (random effect model) regression analysis on a dataset of 57 MFIs over the period of six years from 2008–2009 to 2013–2014, the study finds that the NGOs have better financial and sustainability performance than non-banking financial companies (NBFCs), but with respect to social performance both are indistinguishable. Further, the former has lesser costs of operation and better portfolio quality than the latter. Therefore, NGOs outperform NBFCs with respect to all dimensions of performance except for social performance where both are equally efficient. In conclusion, the transformation of NGOs to NBFCs may not improve the performance of Indian MFIs. These findings are expected to have substantial practical implications for managers of MFIs and for policymakers in framing policies for Indian MFIs.
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Hussain, Hafezali Iqbal, Katarzyna Szczepańska-Woszczyna, Fakarudin Kamarudin, Nazratul Aina Mohamad Anwar, and Mohd Haizam Mohd Saudi. "Unboxing the black box on the dimensions of social globalisation and the efficiency of microfinance institutions in Asia." Oeconomia Copernicana 12, no. 3 (September 27, 2021): 557–92. http://dx.doi.org/10.24136/oc.2021.019.
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Research background: Microfinance institutions (MFIs) play an important role in alleviating poverty. Thus, MFIs should be efficient in order to ensure that their objectives on social welfare and financial performance can be achieved by identifying the potential determinants, specifically on social globalisation.
Purpose of the article: This paper examines the impacts of the social globalisation dimensions of interpersonal, informational, and cultural globalisations on the financial and social efficiency of MFIs.
Methods: The data period covered the years 2011?2018; the data set consists of 176 MFIs from six Asian countries. The Data Envelopment Analysis (DEA) approach was employed to examine the MFIs? efficiency levels. Generalised Least Square (GLS) regressions were used to analyse the impacts of social globalisation and other determinants towards the efficiency of MFIs.
Findings and value added: Interpersonal globalisation had a significantly negative correlation with social efficiency, suggesting that increasing the number of foreigners in management intrudes on local managers? decisions. Informational globalisation had a significantly positive correlation with financial and social efficiency, which signifies that more information produces monopolistic profits in this industry. Finally, cultural globalisation had a positive correlation with social efficiency, demonstrating that a global trading culture improves the abilities and technological skills for labour development and enhances MFIs? social efficiency. In general, the Cobb Douglas Production theory explained the understanding of the impacts social globalisation has on MFI efficiency. Furthermore, the findings from this study could provide important scientific, practical gap and contribute new insights and implications to various parties. Firstly, governments or policymakers can establish effective national policies and strategies. Secondly, this study could support investors in monitoring and understanding the performance of MFIs. Finally, the research could fill scholarly gaps and uncover more potential factors that influence the efficiency of MFIs.
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Guðjónsson, Sigurður. "Microfinance institutions' failure to address poverty: A narrative critical literature review." Tímarit um viðskipti og efnahagsmál 14, no. 1 (June 30, 2017): 79. http://dx.doi.org/10.24122/tve.a.2017.14.1.4.
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This critical literature review begins by giving a short introduction to the microfinance industry. Microfinance institutions (MFIs) are explained and an account is given of their dual performance goals of financial performance (‘financial sustainability’) and social performance (‘outreach’). While MFIs’ social performance is directly aimed at poverty reduction, it is noteworthy that often they fail to address poverty (i.e., they fail to deliver outreach). The aim of the paper is to answer the following research question: Why have microfinance institutions (MFIs) failed to address poverty? In order to establish the reason, the first step is to look at how the MFIs are managed and controlled, i.e. to examine MFIs’ corporate governance literature. This critical literature review was conducted using systematic on-line searches in the databases Scopus and Web of Knowledge; the main key words used were microfinance, gender, corporate governance and performance. The unconvincing nature of the findings of a review of the corporate governance literature suggests that another factor should be taken into consideration: that of gender; after all, MFIs are mainly used by women. The findings from reviewing the microfinance literature suggests that microfinance gender literature may explain why MFIs have not adequately addressed poverty, but this literature consists of a few studies only and further studies are needed. The literature on gender in general is more substantial, however. Some account of it will be given in this literature review. The findings of this literature review should benefit policymakers on the one hand, who are in a position to advance gender equality, while on the other hand it should be of use to academics, who can research MFIs in relation to gender; further studies of gender in MFIs are encouraged.
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Prasetya, Maria Agape Widya, Princisca Lutfitasari, Justi Sairo, and Birgitta Dian Saraswati. "ANALISIS PENGARUH LEMBAGA KEUANGAN MIKRO DAN INDEKS PEMBANGUNAN MANUSIA TERHADAP KETIMPANGAN PENDAPATAN DI INDONESIA." ANALISIS 12, no. 1 (March 31, 2022): 60–74. http://dx.doi.org/10.37478/als.v12i1.1137.
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Income inequality is still a problem in the Indonesian economy. In order to realize the welfare of the people evenly, the government seeks to reduce the income inequality between provinces in Indonesia. The existence of microfinance institutions (MFIs) is expected to help the economy of the poor so that income distribution will be realized. This study aims to analyze the effect of loans disbursed by MFIs, the number of MFIs and the human development index (HDI) on income inequality in Indonesia. By using panel data regression analysis with a fixed effect model approach, this study shows that the number of loans disbursed techniques by MFIs has a significant positive effect on income inequality in Indonesia, while the HDI variable and the number of MFIs have no effect on income inequality in Indonesia
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Augendra, Bhukuth, Terrany Bernard, and Wulandari Ani. "Why Micro and Small Family Enterprises Do Not Borrow from Microcredit Institutions? A Case Study in East Java, Indonesia." Studies in Business and Economics 14, no. 3 (December 1, 2019): 18–32. http://dx.doi.org/10.2478/sbe-2019-0040.
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AbstractIt is assumed that MSMEs growth is limited due to lack of access to the financial markets, therefore MFIs play a role to refine such market imperfection. This paper aims to examine this assumption. A qualitative approach is used to obtain information from MSMEs and MFIs. Eight enterprises and three MFIs; two of them are cooperatives and one government microfinance agency are studied. There is a high demand for credit whereas not all the demand is satisfied mainly those family businesses involved in the informal sector. The main findings exhibit that even when MFIs credit is at disposal, formal and informal MSMEs prefer to draw a loan from Informal Financial Institutions (IFIs) because the market is more flexible than the MFIs which embrace the same strategies as commercial banks.
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Ermawati, Tuti, Agus Eko Nugroho, M. Soekarni, Nur Firdaus, Jiwa Sarana, Ragil Yoga Edi, Septian Adityawati, and Ikval Suardi. "The COVID-19 pandemic and its impact on microfinance institutions in Indonesia." Enterprise Development and Microfinance 32, no. 1 (June 1, 2021): 93–106. http://dx.doi.org/10.3362/1755-1986.21-00002.
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The paper aims to analyse the impacts of the COVID-19 pandemic on microfinance institutions (MFIs) and identify mitigation and adaptation measures to cope with the situation. An online survey and focus group discussions were employed to capture how far the COVID-19 pandemic affects MFIs’ business. The results show that MFIs’ performance is negatively affected due to the COVID-19 crisis as their major customers, micro and small enterprises (MSEs), have experienced a contraction. MFIs have implemented several mitigation and adaptation measures to cope with the situation and future shocks. These results provide an overview of how far the COVID-19 crisis affects MFIs which can help the government design policies that can support MFIs and MSEs to survive. However, some issues related to methodology, such as the inability to capture complex and profound information, survey monitoring, and response rate, influenced the analysis so that the research may lack generalizability. Thus, a more holistic methodology is needed to investigate the impacts of the COVID-19 pandemic comprehensively.