Paper
Measuring the Social Performance of Microfinance in Europe
Examining financial and social performance of European MFIs
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15 pages
This paper measures European MFIs social performance according to a core set of common indicators developed by the Social Performance Task Force, using data collected in 2010 by the European Microfinance Network on a sample of 170 microfinance actors operating in 21 countries.The paper examines the process of translating MFI mission into social impact. It analyzes the three dimensions of the social performance process corresponding to different sets of indicators, namely, MFI intent, effectiveness of MFI's internal system and activities in achieving targets, MFI outputs, and its capacity to positively affect clients life and achieve social goals. Conclusions include:
- Recent research suggests the existence of synergies between MFIs social and financial performance;
- Some of the results are not statistically significant because the samples have been too small;
- European data exhibits a trade-off between women or migrant outreach, and the operating expenses ratio;
- European MFIs providing smaller loan balances are less efficient in terms of operating expense ratio and less financially sustainable.
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