Promoting Microfinance: Challenges and Innovations in Developing Countries and Countries in Transition

247 Pages·2013·1.399 MB·English

by  Ronny Manos, Jean-Pierre Gueyié, Jacob Yaron (eds.)

Promoting Microfinance
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Promoting Microfinance
Challenges and Innovations in
Developing Countries and Countries
in Transition
Edited by
Ronny Manos
Lecturer in Finance, College of Management Academic Studies, Israel
Jean-Pierre Gueyié
Associate Professor of Finance, University of Quebec in Montreal, Canada
and
Jacob Yaron
Faculty Consultant, College of Management Academic Studies, Israel
Editorial matter, introduction and selection © Ronny Manos,
Jean-Pierre Gueyié, Jacob Yaron 2013
Remaining chapters © Respective authors 2013
Softcover reprint of the hardcover 1st edition 2013 978-1-137-03490-8
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First published 2013 by
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ISBN 978-1-349-44205-8 ISBN 978-1-137-03491-5 (eBook)
DOI 10.1057/9781137034915
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Contents
Tables and Figures vii
Notes on Contributors x
Part I The Importance of Innovations
1 Challenges and Innovations in Promoting
Microfinance 3
Ronny Manos, Jean-Pierre Gueyié and Jacob Yaron
2 The Implications of a Growing Microfinance
Market in Latin America and the Caribbean 17
Ana Pantelic´
Part II Policy Formulation and Regulation
3 The Microfinance Sectors in Peru and Mexico:
Why Have They Followed Different Paths? 39
Pablo Cotler and Giovanna Aguilar
4 A Push Towards Revitalizing Rural Financial
Institutions: Lessons from Mexico’s PATMIR Project 56
Julia Paxton
5 Regulation and Performance of Ghana’s Multi-tiered
Rural and Microfinance Industry 77
William F. Steel
Part III Measuring Impact and Performance
6 Micro-credit Access and Household Welfare
in Rural Cameroon 103
Francis Menjo Baye
7 A Cost Function Approach to MFI Efficiency:
The Role of Subsidy and Social Output Measures 132
Valentina Hartarska, Denis Nadolnyak and Shen Xuan
8 Social and Financial Performance of Microfinance
Institutions: A Multi-stage Data Envelopment
Analysis Application 148
Joseph Nzongang and Eloge Nishimikijimana
v
vi Contents
Part IV Coping with Conflicts and Disasters
9 Designing Apex Organizations in Conflict-affected
Environments: An Analysis of Recent Experiences in
Bosnia-Hezegovina and in Afghanistan 173
Stephanie Charitonenko and Dale Lampe
10 Are Microfinance Institutions and Their Customers
Reactive to Disaster Risk? Main Topics and
Four Case Studies 197
Davide Castellani, Simonetta Chiodi and Laura Viganò
Author Index 221
Subject Index 225
Tables and Figures
Tables
3.1 Regulated microfinance institutions in Peru
(as of December 2011) 44
3.2 Peru’s microfinance industry (as of 2011) 46
3.3 Microfinance institutions in Mexico
(as of September 2010) 49
3.4 Mexico’s microfinance sector (as of 2010) 49
4.1 Outreach and performance measures for
34 cooperatives (as of December 2006) 63
5.1 Evolution of regulatory approach to RMFIs
by Bank of Ghana 79
5.2 RCB financial indicators (in million new Ghana Cedis) 86
5.3 RMFIs in 2010: number, clients and portfolios 88
5.4 Poverty index of clients by type of institution and
geographical zone 91
5.5 Sustainability and profitability by type of RMFI
(2004 and 2010; percentage) 92
5.6 Performance by type of program (2005 survey data) 92
5.7 Loan recovery, costs and productivity by type of RMFI
(2004 and 2010; percentage) 93
6.1 Construction of variables related to household
credit status 112
6.2 Weighted descriptive statistics 114
6.3 OLS of reduced-form borrowing equation and probit of
sample selection equation 116
6.4 Wellbeing production function: dependent variable
is log of total expenditures per adult 118
6.5 Wellbeing production functions by expenditure sources 122
6.6 Wellbeing production functions by zone and gender:
dependent variable is log of total expenditure per adult 124
vii
viii Tables and Figures
7.1 Summary statistics 139
7.2 Regression results with cost function, by output
measures and input prices (with and without
equity subsidy) 140
7.3 Regional scale economies, by outputs (loan portfolio
and number of active borrowers) and by input prices
(with and without cost of equity subsidy) 143
7.4 Own-price elasticticies and elasticities
of substitution 144
8.1 Retained input and output variables for each role of
an MFI 156
8.2 Descriptive statistics of the 52 MC²s data
(Financial Year: 2009) 158
8.3 Summary of DEA Results: efficiency scores
categorized by types of performance 159
8.4 The 13 best MC²s for overall performance 160
8.5 Correlation coefficients of the different
performance categories 161
8.6 Summary of DEA results: the returns to scale
categorized by performance 163
9.1 Apex phases of development and selected
performance indicators 176
9.2 Summary of MFI partner performance standards
used in BiH case 178
9.3 MISFA’s categories of performance standards for
partner MFIs 188
9.4 Key lessons and recommendations 192
10.1 Countries’ main risks 204
10.2 Microfinance intermediaries interviewed 205
10.3 Credit strategies 207
10.4 Products offered 209
10.5 MFIs and disasters 210
10.6 Clients and disasters: The MFIs’ view 211
10.7 Perspectives and open issues 212
Tables and Figures ix
Figures
2.1 Microfinance service providers in the LAC region
in 2010 21
2.2 A country comparison of loan sizes and per capita
GDP in 2010 26
2.3 Compartamos Banco’s gross loan portfolio growth
(1996–2010) in US$ 30
3.1 Evolution of MFIs’ loan Portfolio in Peru
(millions of soles, 2009) 45
4.1 Coverage and cost of PATMIR I and PATMIR II 59
4.2 Number of institutions by methodology and consultant
during PATMIR I (2003–07) 62
4.3 Subsidy dependence and outreach for 13 cooperatives,
December 2006 66
5.1 Total RMFI clients, deposits and loans, 2001–10 86
8.1 A multi-stage DEA decomposition of the performance
of an MFI 157
8.2 Breakdown of financial performance for the
13 globally efficient MC²s 161
8.3 Social performance versus financial performance for
the 13 globally efficient MC²s 165
8.4 Efficient MC²s grouped by overall, social and financial
performance 165