Economics at your fingertips  

Determinants of the Performance of Microfinance Institutions: A Systematic Review

Niels Hermes () and Marek Hudon

No 18-024, Working Papers CEB from ULB -- Universite Libre de Bruxelles

Abstract: Microfinance institutions (MFIs) generally aim at improving the access of the poor to financial services while at the same time being financially sustainable. But what do we know about how MFIs reach and combine these two goals? We carry out a systematic review of close to 170 articles discussing the determinants of the financial and social performance of MFIs. The review shows that the most important determinants addressed in the literature are MFI characteristics (size, age, type of organization), their funding sources, the quality of organizational governance and the MFIs’ external context such as macroeconomic, institutional and political conditions. The evidence on these issues is rather mixed. Moreover, the direction of the relationship between these drivers and MFI performance depends on the context, particularly the country-specific context. Finally, there is a lack of consensus in the literature on the measurement of financial and social performance. Due to the complexity of the concept, we argue that social performance should only be assessed by using a multidimensional perspective. This can be done either by applying recent and holistic social performance measures such as the SPI4, or at least by using a combination of proxies, such as outreach, gender and rural measures.

Keywords: microfinance; performance; social performance; governance; microcredit (search for similar items in EconPapers)
JEL-codes: B00 O16 Q14 (search for similar items in EconPapers)
Pages: 61 p.
Date: 2018-06-25
New Economics Papers: this item is included in nep-fmk and nep-mfd
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (22) Track citations by RSS feed

Published by:

Downloads: (external link) Œuvre complète ou partie de l'œuvre (application/pdf)

Related works:
Working Paper: Determinants of the Performance of Microfinance Institutions: A Systematic Review (2018) Downloads
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:

Ordering information: This working paper can be ordered from ...

Access Statistics for this paper

More papers in Working Papers CEB from ULB -- Universite Libre de Bruxelles Contact information at EDIRC.
Bibliographic data for series maintained by Benoit Pauwels ().

Page updated 2022-11-12
Handle: RePEc:sol:wpaper:2013/272925