Technology gaps, social outreach and financial sustainability of South Asian MFIs: bootstrap DEA meta-frontier approach

Asif Khan (), Anju Goswami and Tonmoy Choudhury
Additional contact information
Asif Khan: Institute of Mangement Technology (IMT) Nagpur
Anju Goswami: Indian Institute of Foreign Trade
Tonmoy Choudhury: King Fahd University of Petroleum and Minerals

Electronic Commerce Research, 2025, vol. 25, issue 3, No 9, 1577-1606

Abstract: Abstract The Microfinance Institutions (MFIs) operate to achieve twin objectives: financial and social. South Asian MFIs have a major industry share in terms of clients and loan portfolios. However, the operating environment in terms of culture, legalities, technology, regulations, and funding is heterogeneous. Additionally, the diverse environment also affects the MFIs' performance in different ways. Therefore, the objective of this paper is to examine the dual goals (financial and social) of MFIs operating in South Asia. The authors incorporate bootstrap data envelopment analysis to measure bias-corrected efficiency scores. Additionally, to account for technological heterogeneity, we have opted for a meta-frontier approach. The authors also estimated the technology gap ratios and relative inefficiencies of individual MFIs. Our analysis is based on 2258 observations of MFIs operating during the years 2005 to 2018 in India, Bangladesh, Nepal, and Pakistan. Our results confirm that MFIs in the South Asian constituency are inclined towards financial goals rather than social outreach. Moreover, managerial inefficiency is the main cause of the lower level of performance in the selected region. Therefore, MFIs need to allocate resources efficiently and adopt the latest technology to further enhance social as well as financial performance levels.

Keywords: Social outreach; Financial sustainability; Bootstrap data envelopment analysis; DEA meta-frontier; South Asia; Microfinance institutions (search for similar items in EconPapers)
JEL-codes: G21 G23 (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1007/s10660-023-09747-9 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:elcore:v:25:y:2025:i:3:d:10.1007_s10660-023-09747-9

Ordering information: This journal article can be ordered from
http://www.springer.com/journal/10660

DOI: 10.1007/s10660-023-09747-9

Access Statistics for this article

Electronic Commerce Research is currently edited by James Westland

More articles in Electronic Commerce Research from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().