[wanabidii] Ebrief 'The Effect of Boards on the Performance of Microfinance Institutions: Evidence from Tanzania and Kenya'

	The Effect of Boards on the Performance of Microfinance Institutions: Evidence from Tanzania and Kenya By Neema Mori and Donath Olomi
	Although microfinance institutions (MFIs) are the most prominent providers of financial services to low-income people, their economic and social performance is subject to debate. How MFIs are governed is likely to affect their efficiency, outreach to the poor, sustainability, and impact on poverty alleviation.   This study explores and examines the effects of the governing board on the social and financial performance of MFIs. The first phase of the study explores MFI board members’ awareness and perception of their roles and how this affected their participation in the board and their influence on it.   The second phase examines the effect of specific board member characteristics (external representation, international source, education, and gender) on the economic and social performance of the MFI through a survey of 337 board members in Kenya and Tanzania. The pilot study established that although MFI board members are largely aware of their role, a few are either not aware or assertive enough, and this impacts the extent of their influence.   Contrary to expectations, less educated, female, and local directors bring about superior financial and social performance of MFIs. The main implication is that we need to look beyond the traditional dimensions of capacity when considering what resources are appropriate for supporting MFIs, including at the board level. Specific policy measures are recommended.       To view full report click Here.
	If you would like to request a hard copy, please contact REPOA or REPOA’s  Communications Officer.                 REPOA provides research grants for undertaking research on matters relating to local governance, growth, social protection and climate change. Join us on
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Communications Officer

 

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