The environmental performance of microfinance institutions (MFIs) has received considerable attention in recent years. However, the question of whether MFIs' involvement in environmental practices ...can drive their financial sustainability has yet to be addressed. This is the knowledge gap that we intend to investigate in the current study. Specifically, using a panel of 587 MFI‐year observations for the 2007–2014 period, we investigate whether pursuing proactive environmental strategies, individually and in aggregation, can improve the financial sustainability of MFIs in South and Southeast Asian countries. By analyzing aggregate environmental performance, we demonstrate that environmental performance adversely influences the financial performance of MFIs. This provides support for the trade‐off hypothesis that predicts that higher levels of environmental practices worsen firms' financial sustainability. Our results also show that the relationship between the individual environmental performance dimensions and financial performance of MFIs varies with the individual dimension of green practice being considered. Finally, we find that there is a significant variation in this relationship across MFI ownership types. The findings have valuable implications for practitioners, investors, and policymakers.
Purpose
The purpose of this paper is to calculate the financial inclusion index and analyze its dynamics in developing countries.
Design/methodology/approach
The authors use the two-stage principal ...component analysis (PCA) method and consider financial technology innovations to improve the accuracy of the financial inclusion index.
Findings
The authors found a downward trend in the financial inclusion index in most developing countries over the study period. The authors also found that a high financial inclusion index is linked to high scores in the Doing Business and high business climate regulation ranking. In addition, the authors observed that the rates of low financial inclusion in developing countries are due to low utilization of and unequal access to financial services.
Practical implications
The analysis suggests that policymakers in developing countries could invest in digital infrastructure to extend access to financial services in remote areas. They could also encourage financial innovation, particularly in financial technologies, by adopting flexible regulatory frameworks. Promoting the financial inclusion of marginalized groups through targeted initiatives tailored to their needs is another solution. They could also encourage the use of financial services by raising awareness and educating populations through training programs. Finally, to improve the business climate, governments could simplify administrative procedures and promote transparency and legal stability.
Originality/value
Unlike previous studies, the use of the two-stage PCA method and the consideration of financial technology (Fintech) innovations such as mobile money in the determinants of the financial inclusion index improve the accuracy of the index.
Microcredit offers an innovative response to non-traditional financing and development needs for marginalized individuals. Here, impact assessment is very useful in that it helps to determine whether ...or not the objectives set at the onset are achieved and what can be done to correct the impediments to achieve better results. The paper analyzes the socio-economic effect of microcredit through the novel dual approach of self-reported perception and relationships with others. The data were gathered in collaboration with the Fonds Mauricie in November, 2019. Apart from the improvement in the financial indicators of micro-enterprises, the results show that microcredit has enhanced micro-entrepreneurs’ living conditions and family situation at rates of 88 and 91 percent, respectively. Regarding morale, 88 percent of micro-entrepreneurs report feeling better and optimistic about the future, and 92 percent report better relationships with others. In particular, the socio-economic effect of microcredit is determined by a better family situation, better living conditions and better financial situation and business income. These results imply that microfinance institutions must extend their financing to all segments of the population, especially the most vulnerable people such as immigrants and indigenous peoples.
The objective of this study is to investigate the relationship between longevity and efficiency dynamics of nonprofit microfinance institutions (NMFIs) over the 2005–2014 period. We examined this ...using a dynamic data envelopment analysis framework that considers the effect of carry-over activities between two consecutive time periods. A robust regression analysis was then used in our second-stage analysis to identify the efficiency drivers. Results showed that new and younger NMFIs perform better than matured ones, so older NMFIs are vulnerable to competition from younger peers and thus, they are more likely to fail. Results also show that NMFIs were not severely affected by the 2008 financial crisis.
The paper examines the effect of regulation on microfinance institutions' (MFIs) sustainability and outreach in Sub-Saharan Africa (SSA). Using unbalanced panel data from 2002 to 2012 for 30 ...countries and a multilevel estimation technique, we find that regulation helps improves the sustainability and breadth of outreach but not the depth. We also find that MFIs that accept deposits have better sustainability but tend to serve the marginal poor. Finally, regulatory quality has a positive impact on outreach and sustainability. Overall, the paper casts new light on the contribution of regulation to the dual objectives of microfinance.
Purpose
This study aims to propose a model of entrepreneurial microcredit support that could address the problem of entrepreneurial support provided by microfinance institutions. This objective is ...justified by the need to produce scientific knowledge that could be of use to practitioners and political decision-makers who formulate and implement strategies of social inclusion and poverty reduction.
Design/methodology/approach
The study adopts a socio-constructivist research perspective. Social constructivism is a theoretical approach that posits that all social reality is constructed. In other words, individuals construct their knowledge of reality relative to their social setting. This justifies the use of the focus group to supplement and validate the data gathered in an individual interview. The socio-constructivist perspective allows us to better understand and develop knowledge based on the meaning that interviewees attribute to their experience. This perspective also justifies the choice of qualitative data collection method. The data were collected during semi-structured interviews.
Findings
Entrepreneurial microcredit support is distinguished from classic entrepreneurial support because it places the individual at the center of the process by emphasizing soft skills in the development of the entrepreneurial spirit. This approach engenders an efficient support process that comprises three main steps: determination of entrepreneurial potential, empowerment and reinforcement of autonomy and acquisition of managerial skills. The efficiency stems from the fact that the time factor is not a constraint in the entrepreneurial microcredit support process and from the relationship of proximity and trust between the credit agent and the micro-entrepreneur.
Originality/value
To the best of authors’ knowledge, this is the first paper to deal with the entrepreneurial microcredit support, which is completely different from the classical entrepreneurial support because of the uniqueness of microfinance and micro-entrepreneurs. The model clearly reveals that the support for the development of the skills required to successfully run a microenterprise is provided based on a socio-constructivist approach in which the micro-entrepreneur is the main actor in the construction of “mobilized knowledge” required to nurture promoters’ entrepreneurial spirit. Consideration of soft skills in a socio-constructivist perspective is, therefore, indispensable for entrepreneurial development.
I argue that micro‐equity may be used to complement or substitute micro‐credit programmes, which involve lending rather than risk sharing. By becoming a stockholder in the micro‐enterprise rather ...than a lender, the micro‐equity provider is in a more tightly coupled relationship, providing knowledge and guidance necessary for ensuring success of the venture. Moreover, I show that while micro‐credit financing places a heavy cash drain on micro‐enterprises and leads to sub‐optimal growth during the course of the evolution of the micro‐enterprise, the mix of micro‐equity with micro‐credit may prove to be more valuable to nurture the sustainable growth of micro‐enterprises.
This article uses Habermasian philosophy as a reading grid to understand the eminently political aspect of international accounting standard-setting. We specifically analyze the accounting ...regulations specific to the exploration for and the evaluation of mineral resources in the European context. The rise of the IASC and its successor, the IASB, favors the emergence of a new phase in accounting standard-setting, with a shift from a ruling logic to regulations that put the economic and social actors at the forefront of the negotiations. This change is particularly obvious in the notorious exception allowed by IFRS 6 (Exploration for and evaluation of mineral resources) exempting applicants from paragraphs 10–12 of the IAS 8. This example allows us to question the legitimacy of international accounting standardization and the ethical problems it poses.
ne varie pas significativement (p > 0,05) d'une saison a l'autre. Une gestion efficace de ces déchets doit associer les actions « prevention », « valorisation » et « stockage » avec un maximum de ...pré-collecte.
The objective of the paper is to analyze the equilibrium in an economy where commercial banks/microfinance institutions can choose to provide downscaling/upscaling lending. I show that externalities ...are entrenched in the acquisition of the knowledge to provide either downscaling or upscaling lending. More importantly, downscaling lending dominates upscaling lending because it is only when the formal financial institutions venture into downscaling lending that the highest social welfare can be attained.
