China : Comparing NGO-Type MFIs in Shaanxi, China, with Grameen Bank, Bangladesh

This paper examines the sustainability of nongovernmental organisation-type microfinance institutions in Shaanxi province, China in comparison with Grameen Bank, Bangladesh. The findings show that despite geographical restrictions, the selected microfinance service providers have successfully expanded their services to isolated mountainous regions where formal financial institutions were non-existent earlier. They have built a strong financial and informational network with Plan China (country office of Plan International), China Association of Microfinance and women federation (Shaanxi province). However, the lack of funds, limited service provisions and restrictive policy environment shackles the industry from further expansion; necessitating urgent remedial steps for resolving existing barriers and allowing these institutes to participate in China's growth. The undertaking of similar research in other provinces is suggested for a better understanding of the Chinese microfinance sector