Membership in Bangladeshi MFIs: Growing, Volatile, and Multiple

This paper attempts to understand the growth, volatility and multiplicity of microfinance institution (MFI) membership in Bangladesh, by studying a group of 53 borrowers over a period of three years.

The paper uses data from another element of the Grameen II study, to show why these borrowers chose to join, use and leave MFIs.

As per the paper, the sample was carefully chosen to include:

• Well established as well as newly joined Grameen members;
• Grameen members who had earlier had problems with their repayments;
• Members of MFIs other than Grameen;
• Ex-Grameen and other MFI members who were not MFI members anymore;
• People who had never been MFI members.

The paper makes the following comments on the three study parameters:

• Growth: Owing to the competition between MFIs and increasing awareness between clients, growth in Bangladeshi MFIs has been strong;
• Volatility: Members shift between MFIs as the field staff try and entice them with bigger and better loans and rewards;
• Multiple membership: Multiple memberships are growing at a fast rate for Grameen and other MFIs.