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Kar, Santa
- A Study of Efficiency of Microfinance Institutions in India: A DEA Approach
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Authors
Santa Kar
1,
Joyeeta Deb
1
Affiliations
1 Department of Commerce, Assam University, Silchar, IN
1 Department of Commerce, Assam University, Silchar, IN
Source
The Microfinance Review, Vol 10, No 1 (2018), Pagination: 76-87Abstract
Microfinance institutions (MFIs) are considered to be the most important mechanism for achieving financial inclusion in developing countries like India where a large population is still deprived of formal financial services. Owing to the growing importance of MFIs, it is equally important to study the efficiency of these institutions which this paper attempts to do by selecting 21 Indian MFIs with the legal status of a non-bank financial institution (NBFI) and Non-governmental organisation (NGO), and by using Data Envelopment Analysis. The study used BCC Model and Undesirable Measure Model for gauging the efficiency of the MFIs. The Spearman’s Rank Correlation was estimated to check the correlation between the scores computed by using both the models. The study further attempts to compare the efficiency between NBFI- MFIs and NGO-MFIs. Results show that the average technical efficiency (TE) score under the BCC model was 0.771 and under Undesirable Measure Model was 0.997. The findings suggest that the relatively inefficient MFIs need to minimise the Portfolio at Risk (PaR)>30 to the extent of 50% in order to become efficient. Further it indicates that there exists positive correlation between the ranks of the MFIs under BCC and Undesirable Measure Model. The results also show that efficiency of the NGO-MFIs is at par with that of the NBFI- MFIs.Keywords
MFIs, Data Envelopment Analysis, BCC Model, Undesirable Measure Model.
References
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- Analysis of Productivity in Indian Microfinance Institutions Using Malmquist Approach
Abstract Views :295 |
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Authors
Affiliations
1 Department of Commerce University of Science and Technology, Meghalaya, IN
1 Department of Commerce University of Science and Technology, Meghalaya, IN
Source
The Microfinance Review, Vol 12, No 1 (2020), Pagination: 39-47Abstract
This paper aims to examine total factor productivity (TFP) change in the Indian Microfinance Institutions (MFIs) using a balanced panel data of 380 observations of 38 MFIs operating over a time period of 10 years. The selection of input and output for the study was based on the sustainability aspect of MFIs. Results indicate that the TFP of the MFIs as a whole experienced an average annual increase of 1.4% during the study period. Further decomposition of TFP growth reveals that technological upgradation in the industry accounted for nearly two-thirds of TFP increase and technical efficiency for the remaining.Keywords
Productivity Change, Malmquist Productivity Index, Indian MFIs.References
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