Towards a plural history of microfinance

Copestake, James; Johnson, Susan; Cabello, Mateo; Goodwin-Groen, Ruth; Gravesteijn, Robin; Humberstone, Julie; Nino-Zarazua, Max; Titus, Matthew

doi:10.1080/02255189.2016.1197102

Cited by 21 publications

(11 citation statements)

References 41 publications

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“…Apart from age and size, this study includes international connection, portfolio risk, and risk coverage as the control variables. International connection has some effects on governance mechanisms (Copestake et al, 2016). Also, the risk factors may vary across organisations and have significant effects on MFIs' double bottom line performance (Devi & Shaikh, 2017).…”

Section: Control Variablesmentioning

confidence: 99%

Effects of board independence on microfinance institutions’ performance: The case of Bangladesh

Hussain

Azhar

Rahman

2021

AJAP

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This study aims to examine the relationship between board independence and the performance of microfinance institutions (MFIs). Early studies on microfinance have made immense contributions, particularly in identifying the factors that influence performance. However, studies addressing board independence and its impact on performance remain scarce. Design/ Methodology/ Approach: This study utilised a panel dataset involving 80 MFIs in Bangladesh for the period of 2005-2018. A panel data regression technique was applied to measure the relationship between MFIs' performance and board independence based on the 80 cross-sectional MFIs with 13 years of data. Research findings: Our findings suggest that independent directors and board size facilitate MFIs to become financially sustainable. The findings also indicate that CEO duality enhances institutional sustainability but does not enhance outreach to the poor. While the results of this study partially support the proposition of stewardship theory, the proposition of agency theory is rejected. This indicates that MFIs in Bangladesh are operated by motivated agents with similar interests to the MFIs' owners. Theoretical contribution/ Originality: This investigation contributes to the microfinance governance literature by highlighting the argument that board independence reduces conflict between MFIs' principle and agent. This study also contributes to the global debate concerning CEO duality and MFIs' double bottom line performance from the perspective of a developing country, such as Bangladesh. Practitioner/ Policy implication: The practical implication of this research is on governance mechanisms in terms of their effectiveness, which is influenced by MFIs' competence. Since board members should promote stakeholders' interests rather than the interests of the organisation, there is a need for sound guiding principles that should form an integral part of the policy for better MFI governance practices. Limitation/ Implication: The limitation of this study mainly concerns the lack of evidence concerning whether or not every licensed MFI in Bangladesh has non-manageable stakeholders. Similarly, this study fails to capture the insolvency level of customers. Therefore, future studies may expand on this approach and create a measure for MFIs' outreach to the poor.

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Section: Control Variablesmentioning

confidence: 99%

Effects of board independence on microfinance institutions’ performance: The case of Bangladesh

Hussain

Azhar

Rahman

2021

AJAP

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“…Later financial institutions began to take on other forms, including as credit unions and microfinance movements. Among the champions of microfinance institutions are the Grameen Bank in Bangladesh (established in 1983), BancoSol in Bolivia (1992), and K-Rep in Kenya (1999) (Copestake et al 2016). Some of these microfinance institutions not only provide and contribute to financial wellbeing, but also education, health, and community building.…”

Section: Literature Reviewmentioning

confidence: 99%

Islamic Social Banking: The Way Forward

2018

JEM

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This paper discusses Islamic social banking (ISB). We first critically examine current practice in Islamic banking (IB) and any deviations from core Islamic principles. These can lead to the apparent social failure of IB given that it will then fail to improve on the economic development of ordinary people. We draw comparison with the generally positive contribution of social banking (SB) to be inserted in IB as a means to create a synthesis in the form of ISB. Theoretically, we find IB and SB share similar 3P principles (Profit, Planet, People) in their operations. We extend these principles to another P (for Prophet) to cover the thoughts and guidance of Islam as ethical guidance for ISB to develop framework based on 4P. We suggest an approach to evaluate the social outcomes of ISB and some good SB practices to be considered.

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“…As Copestake et al (2016) point out in their analysis on the history of microfinance, two opposing views prevailone being the neoclassical economics interpretation, which accredits the expansion of financial market opportunities to microfinance and the contrasting political economy critique, which detects increasing opportunities of exploitation.…”

Section: Introductionmentioning

confidence: 99%

Poverty Alleviation Through Financial Practices: The Importance of Microfinance

Arandia

Hepp

2020

International Handbooks in Business Ethics

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Unfortunately, poverty is still a largely unsolved problem in many societies, especially in developing countries. Therefore, it is crucial to analyze and determine possible measures to improve the well-being of the poor and thus diminish social marginalization. Microcredit was once discovered to be the long-desired development tool, which should eradicate poverty, but during the last 40 years it increasingly transformed into a profitable business with the poor. Therefore, the purpose of this chapter is to establish a framework, to understand the benefits of all the stakeholders involved and provide a guide for institutions to similarly

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Towards a plural history of microfinance

Cited by 21 publications

References 41 publications

Effects of board independence on microfinance institutions’ performance: The case of Bangladesh

Effects of board independence on microfinance institutions’ performance: The case of Bangladesh

Islamic Social Banking: The Way Forward

Poverty Alleviation Through Financial Practices: The Importance of Microfinance

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