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Efficiency measurement of microfinance institution branches using DEA

M. Sai Mohini and V. Lavanya

International Journal of Management Concepts and Philosophy, 2024, vol. 17, issue 4, 442-457

Abstract: Many precise efficiency measurement techniques are being used to understand the overall efficiency of MFIs. However, the branches of these MFIs are still struggling hard to reach par with the organisational goals. This study aims to analyse regional-wise and branch-wise inefficiencies to get deeper insights into the potential prospects intended for improvement. The study used a medium-sized Indian MFI to show the whole region's inefficiency score concentration. It has used the benchmarking analysis tool DEA with the directional distance functional (DDF) model to evaluate and compare regional group performance. The study has used appropriate measurement tools such as the Gini index and over/under the inefficiency index to have a rational comparison. There is a huge scope for improvement. The researchers have used cross-sectional data from medium-size Indian MFI for one the year 2020. The results give insights into the branch and region-wise inefficiencies, which are crucial information to policymakers and management.

Keywords: microfinance efficiency; DEA; Gini index; over/under inefficiency index; branch efficiency; COVID-19. (search for similar items in EconPapers)
Date: 2024
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