Microfinance – the provision of financial services to the poor – is high on the public agenda. We discuss and evaluate three myths regarding microfinance based on new data from rated microfinance institutions (MFIs). The first myth is that an efficient MFI needs to be shareholder owned; second...

The microfinance industry carries every sign of an innovation in its take-off phase. The various aspects of the microfinance innovation were developed in the 1980's, twenty years later the industry experiences a phenomenal growth rate, and it has diffused to most developing countries in the...

We investigate the microbank's choice of lending methodology with particular emphasis on group and individual loans. The repayment hypothesis says that the group loan is chosen since borrowers repay under a group loan scheme. The dual objectives hypothesis investigates the choice when the...

Claims have been made that microfinance institutions (MFIs) experience mission drift as they increasingly cater to customers who are better off than their original customers. We investigate mission drift using average loan size as a main proxy and the MFIs lending methodology, main market, and...

We examine the relationship between firm performance and corporate governance in microfinance institutions (MFI) using a self-constructed global dataset on MFIs collected from third-party rating agencies. Using random effects panel data estimations, we study the effects of board and CEO...

Is the microfinance institution (MFI) able to charge unduly high lending rates and obtain a profitability incompatible with perfect competition? We use a global panel data set of MFIs. The Panzar and Rosse revenue test in static and dynamic versions is employed, together with analyses of price...

This study uses a unique, hand-collected sample of microfinance institutions from 73 countries that typically are not investigated in accounting research to analyze the relationships between audit quality and governance mechanisms. We examine two measures of audit quality, namely, the use of Big...

Policy advocates argue the case for the transformation of non-government Microfinance Organizations (MFOs) into shareholder owned firms. The argument is that this will bring about superior performance. This paper investigates whether the superiority of shareholder owned MFOs is empirically...

This paper aims to explain the choice of board and CEO characteristics in microfinance institutions (MFI). Explanations are sought in substitution or complementarity between the characteristics, external governance variables, and financial performance and outreach performance to the poor. The...

This research advances the hypothesis that female leaders (CEO, chair, and director) of a microfinance institution (MFI) give more priority to the poorest families in loan provision than male leaders. We differentiate between a depth and a width dimension of financial inclusion. The data set is...