Financial performances analysis and social preferences of a professional microcredit institution

Dehenain, Juliette
(2018)

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Details

Supervisors
Maniquet, François ; de Regt, Erik
Faculty
Faculté des sciences économiques, sociales, politiques et de communication
Degree label
Master [120] en sciences économiques, orientation générale
Abstract
The paper strives to observe how microfinance institutions (MFIs) can rationalize their behaviors towards the supply of microcredits. Tanking methods coming from Welfare economics, we developed a framework under which, according to its business model, an MFI can coherently rank the distribution of its funds in terms of equity and efficiency. Moreover, through a case study of a business microloan institution, Crédal, we explored several trade-offs that firms need to deal with in the sector of microfinance. That is, a trade-off between the outreach to the most deprived persons and the financial sustainability as well as a trade-off between the number of microloans supplied and the outreach to the most deprived persons. The major conclusion of this paper consists in highlighting the importance of public aids in order to manage the both trade-offs mentioned above but also to underline the economic sense of investing in business microloans in welfare states.