IDEAS home Printed from https://ideas.repec.org/a/nrb/journl/v36y2025i1p34-49.html
   My bibliography  Save this article

Paradigm Shift of Microfinance Institutions in Nepal: A Mixed Method Approach

Author

Listed:
  • Dr. Sanjib Sherpa

    (School of Business, University of Central Lancashire, Preston, Lancashire, PR1 2HE, United Kingdom)

Abstract

This study examines how the transformation of MFIs from non-profit to profit-oriented has impacted their performance in Nepal. A mixed-method approach was applied where quantitative data was analysed using a Propensity Score Matching (PSM), followed by a qualitative thematic analysis. The results show that the transformation of MFIs reduces their profitability and operational self-sufficiency in the short run but increases them in the long run. Furthermore, the study found that the number of clients and the loan size of profit-oriented MFIs are increasing in Nepal, which suggests that MFIs in Nepal are drifting away from their main mission of social welfare, also known as mission drift.

Suggested Citation

  • Dr. Sanjib Sherpa, 2025. "Paradigm Shift of Microfinance Institutions in Nepal: A Mixed Method Approach," NRB Economic Review, Nepal Rastra Bank, Economic Research Department, vol. 36(1), pages 34-49, August.
    • Handle: RePEc:nrb:journl:v:36:y:2025:i:1:p:34-49
    as

    Download full text from publisher

    File URL: https://www.nrb.org.np/er-article/paradigm-shift-of-microfinance-institutions-in-nepal-a-mixed-method-approach/
    Download Restriction: no
    ---><---

    More about this item

    JEL classification:

    • C01 - Mathematical and Quantitative Methods - - General - - - Econometrics
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • L31 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Nonprofit Institutions; NGOs; Social Entrepreneurship

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:nrb:journl:v:36:y:2025:i:1:p:34-49. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Publication Division NRB (email available below). General contact details of provider: https://edirc.repec.org/data/nrbgvnp.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.