Outreach and Efficiency of Microfinance Institutions
AbstractSummary This paper uses stochastic frontier analysis to examine whether there is a trade-off between outreach to the poor and efficiency of microfinance institutions (MFIs). We find convincing evidence that outreach is negatively related to efficiency of MFIs. More specifically, we find that MFIs that have a lower average loan balance (a measure of the depth of outreach) are also less efficient. Moreover, we find evidence showing that MFIs that have more women borrowers as clients (again a measure of the depth of outreach) are less efficient. These results remain robustly significant after having added a number of control variables.
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Bibliographic InfoArticle provided by Elsevier in its journal World Development.
Volume (Year): 39 (2011)
Issue (Month): 6 (June)
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Web page: http://www.elsevier.com/locate/worlddev
microfinance outreach sustainability;
Other versions of this item:
- Meesters, Aljar & Lensink, Robert & Hermes, Niels, 2008. "Outreach and Efficiency of Microfinance Institutions," Research Report 08002, University of Groningen, Research Institute SOM (Systems, Organisations and Management).
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