Microfinance institutions' mission drift in macroeconomic context

Shufang Xu, James Copestake, Xinman Peng

Research output: Contribution to journalArticle

10 Citations (Scopus)
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Abstract

We theoretically discuss the potential macroeconomic influences on MFIs’ depth of outreach and provide empirical evidence, using panel analysis, to investigate determinants of average loan balance per borrower as a percentage of national GNI per capita (ALB), as a proxy indicator for poverty focus or depth of outreach. ALB is found to be positively associated with operational self-sufficiency, a finding that is consistent with the mission drift hypothesis. But it is also positively associated with the shares in GDP of net foreign direct investment (FDI) and domestic credit to the private sector (DCPS). This suggests mission drift is associated not only with MFI-specific factors, but also influence by macroeconomic context.
Original languageEnglish
Pages (from-to)1123-1137
Number of pages16
JournalJournal of International Development
Volume28
Issue number7
Early online date1 Apr 2015
DOIs
Publication statusPublished - Oct 2016

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microfinance
macroeconomics
self sufficiency
self-sufficiency
foreign direct investment
direct investment
Gross Domestic Product
foreign investment
private sector
loan
poverty
credit
determinants
evidence
analysis
indicator

Keywords

  • microfinance; mission drift; depth of outreach; financial performance; social performance; macroeconomic influences

Cite this

Microfinance institutions' mission drift in macroeconomic context. / Xu, Shufang; Copestake, James; Peng, Xinman.

In: Journal of International Development, Vol. 28, No. 7, 10.2016, p. 1123-1137.

Research output: Contribution to journalArticle

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