The Impact of Entrepreneur-CEOs in Microfinance Institutions: A Global Survey

Randøy, Trond; Strøm, R. Øystein; Mersland, Roy

doi:10.1111/etap.12085

Cited by 61 publications

(54 citation statements)

References 59 publications

Supporting

Mentioning

Contrasting

Unclassified

Order By: Relevance

“…Hudon and Louche (2014), in their study of organizational changes induced by transformation in Kenya and Vietnam, observe that transforming MFIs struggle with redefinition of identity, redrawing the boundaries of the firm and issues of legitimacy. These challenges arise because MFIs are by nature hybrid institutions floating between two institutional logics, namely the social logic of poverty alleviation and the commercial logic of becoming self-sustainable (Randøy et al, 2015). Although this double bottom-line principle lies at the very heart of microfinance (Armendàriz and Morduch, 2010), many researchers doubt whether it is possible to achieve in the long run, and observe a potential trade-off between social and financial objectives (Dehejia et al, 2012;Hermes et al, 2011).…”

Section: Transformation As a Profound Country-specific Processmentioning

confidence: 99%

From NGOs to Banks: Does Institutional Transformation Alter the Business Model of Microfinance Institutions?

et al. 2017

Self Cite

View full text Add to dashboard Cite

Microfinance, which pledges to provide financial services to people without access to banking, is chiefly run by non-governmental organizations (NGOs). Little is known about the extent to which the transformation of these NGOs into shareholder-owned and, most often, regulated firms affects the way microfinance institutions (MFIs) conduct their business. By applying the event study methodology to 66 MFIs that have transformed, we quantify the effect that transformation has on the MFIs' business models. Our results suggest that portfolio yield is driven down by 3.9 percentage points due to transformation, indicating that clients get more favorable interest rates. At the same time, MFIs are able to significantly cut down their operational expenses, of which 1.1 percentage points can be attributed to transformation. Other findings include a steep increase in commercial debt leverage and deposits, a significant decrease in the fluctuation of funding costs and a sharp rise in average loan size. Profitability goes down in the short and medium term, while return on equity is driven up in the medium to long run. By exploiting within-MFI data, our approach goes beyond previous studies that mainly relied on between-MFI data. Overall, the results suggest that transformed MFIs become an attractive environment for investors, potentially encouraging a more profit-seeking behavior among transformed MFIs. Acknowledgements.We thank Victoria van Lennep and Li Yang for research assistance in data gathering data. We also AbstractMicrofinance, which pledges to provide financial services to people without access to banking, is chiefly run by non-governmental organizations (NGOs). Little is known about the extent to which the transformation of these NGOs into shareholder-owned and, most often, regulated firms affects the way microfinance institutions (MFIs) conduct their business. By applying the event study methodology to 66 MFIs that have transformed, we quantify the effect that transformation has on the MFIs' business models. Our results suggest that portfolio yield is driven down by 3.9 percentage points due to transformation, indicating that clients get more favorable interest rates. At the same time, MFIs are able to significantly cut down their operational expenses, of which 1.1 percentage points can be attributed to transformation. Other findings include a steep increase in commercial debt leverage and deposits, a significant decrease in the fluctuation of funding costs and a sharp rise in average loan size.Profitability goes down in the short and medium term, while return on equity is driven up in the medium to long run. By exploiting within-MFI data, our approach goes beyond previous studies that mainly relied on between-MFI data. Overall, the results suggest that transformed MFIs become an attractive environment for investors, potentially encouraging a more profit-seeking behavior among transformed MFIs.Word count: 210

show abstract

Section: Transformation As a Profound Country-specific Processmentioning

confidence: 99%

From NGOs to Banks: Does Institutional Transformation Alter the Business Model of Microfinance Institutions?

et al. 2017

Self Cite

View full text Add to dashboard Cite

show abstract

“…Důležitost kvality lidských zdrojů, zejména ve vrcholovém managementu, diskutují Ghani a Mahmood (2011), Galema et al (2012) a Randøy et al (2013). Ghani a Mahmood (2011) poukazují na analýzu provedenou v Pákistánu, kde příčinou nedostatečného rozvoje mikrofi nančního sektoru byla především chybějící tržní orientace vedoucích pracovníků a slabá motivace podřízených zaměstnanců.…”

Section: Lidské Zdrojeunclassified

Microfinance Revolution: Controversies and Challenges

Janda¹,

Zetek²

2015

Politicka ekonomie

View full text Add to dashboard Cite

ÚvodVlády stejně jako mezinárodní organizace dlouhodobě usilují o snížení počtu obyvatel žijících na hranici životního minima nebo pod ní. Kromě dotačních či sociálních programů pro nízkopříjmové obyvatele se již více než třicet let prosazuje fi nanční pomoc založená na mikrofi nančních službách. Původní záměr mikrofi nančních institucí (MFIs) nabízet nízko objemové úvěry začínajícím podnikatelům s nedostatečnou úvěrovou historií nebo chybějícím věcným zajištěním se postupně rozšířil na další produkty, jako jsou mikropojištění, spoření nebo platební styk. V roce 2012 spravovaly MFIs po celém světě úvěry 89 milionům klientů v hodnotě téměř 99 mld. USD (mixmarket.org). Ačkoliv podle hodnotící zprávy Human Development Report za rok 2013 se podíl těch nejpotřebnějších "core poor" relativně snižuje, do současnosti je evidováno přes 1,56 mld. obyvatel, kterým se stále nedaří vymanit se z bludného kruhu chudoby.Přestože jen za období 1990-2014 je ve Web of Knowledge evidováno 440 vědec-kých studií obsahujících v názvu slova microfi nance nebo microcredit a 835 studií zmiňujících tato slova v obsahu dokumentu, nenalezli jsme žádnou publikaci věnova-nou mikrofi nancím v časopisech Politická ekonomie, Prague Economic Papers nebo Finance a úvěr. Cílem tohoto přehledového článku je proto zaplnit tuto informační mezeru v česky psané akademické literatuře a zároveň navázat na předchozí přehle-dové studie Matin et al. (2002), Woller (2002 nebo Brau a Woller (2004) se zaměře-ním na základní vývojové tendence a kontroverzní témata mikrofi nancí ve světové akademické literatuře. Ačkoliv mikrofi nanční model aplikovaný v rozvojových zemích se v České republice (ČR) prakticky nevyskytuje, představuje ČR společně s dalšími vyspělými státy důležitý zdroj fi nancování poskytovatelů mikrofi nančních služeb. Častokrát se dávají mikrofi nance do souvislosti s historickým vznikem družstevních záložen, které měly v počátcích za cíl fi nancovat podobně jako MFIs obchodní aktivity svých členů ve skupině na principu kolektivního ručení. Tento záměr se ale postupně u družstev-* Práce na tomto článku byla podporována granty P402/11/0948 GAČR a 15-00036S GAČR. Karel Janda potvrzuje výzkumnou podporu získanou jako Affi liate Fellow na CERGE-NHÚ a během jeho dlouhodobých výzkumných pobytů na

show abstract

“…Christen & Drake, 2002;Hartarska & Nadolnyak, 2007;Arun & Annim, 2010;Strøm et al, 2014;Randøy et al, 2015). Evidence suggests that the microfinance industry is well established in certain countries and regions more so than others.…”

Section: Introductionmentioning

confidence: 99%

Microfinance Institution Performance: Does the Macroeconomy Matter?

Churchill

Danso

Nyatefe³

2018

J of App Econs and Policy

View full text Add to dashboard Cite

The performance of Microfinance Institutions (MFIs) has been compared at various levels for the purpose of replications and policy formulations. However, the potential effects of the macroeconomy on MFI performance are often not considered. We propose that understanding the possible effects of country-level factors on MFI performance can help provide a more accurate evaluation and explain where microfinance fits in the development process. Based on data collected on 1544 MFIs, merged with country-level macroeconomic and macro-institutional data, we examine the effects of the macroeconomy on MFI performance. The results suggest that high economic growth is associated with better MFI performance. However, other modes of economic development, including wage employment opportunities, appear to impede MFI financial performance.

show abstract

The Impact of Entrepreneur-CEOs in Microfinance Institutions: A Global Survey

Cited by 61 publications

References 59 publications

From NGOs to Banks: Does Institutional Transformation Alter the Business Model of Microfinance Institutions?

From NGOs to Banks: Does Institutional Transformation Alter the Business Model of Microfinance Institutions?

Microfinance Revolution: Controversies and Challenges

Microfinance Institution Performance: Does the Macroeconomy Matter?

Contact Info

Product

Resources

About