|Publication type:||Article in scientific journal|
|Type of review:||Peer review (publication)|
|Title:||Outreach and performance of microfinance institutions : the importance of portfolio yield|
|Published in:||Applied Economics|
|Publisher / Ed. Institution:||Routledge|
|Subjects:||Microfinance; Financial return; Outreach; Operating expense; Portfolio yield|
|Subject (DDC):||332.1: Banks|
|Abstract:||In this paper, we examine the interaction between social outreach and financial return in microfinance. Running multivariate regression models and using 1,805 observations of microfinance institutions between 2004 and 2013, we find strong evidence suggesting that institutions with more social engagement – in terms of outreach to the poor – earn higher portfolio yields. We also find that measures of outreach are associated with increased operating expenses. As return figures are influenced by both costs and yield, and because both increase to a similar degree with the depth of outreach, these two effects lead to a zero sum result on return measures. This finding could explain why existing studies assessing the interaction between social outreach and different measures of financial performance in microfinance (such as return on assets/equity, operating expenses, operational self-sufficiency) have not produced consistent results.|
|Fulltext version:||Published version|
|License (according to publishing contract):||Licence according to publishing contract|
|Departement:||School of Management and Law|
|Appears in collections:||Publikationen School of Management and Law|
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