New report on funding sources for MFIs facing the most difficulty acquiring financing MIX’s Data Brief No. 6 explores the funding relationships for MFIs in the lowest quartile in terms of size, age, profitability, and portfolio quality
Submitted by Syeda Younus on Jun 29, 2010
The Microfinance Information Exchange (MIX) has released a report by its lead researcher Adrian Gonzalez that draws on data from MIX’s new Funding Structure Data to provide information on funding patterns among those microfinance institutions (MFIs) that might find more difficulty in obtaining financing.
Data Brief No. 6: Microfinance Funders Profiles - A Short Guide for Young and Small Institutions Still Looking for a Match explores the funding sources of the lowest MFIs in terms of size, age, profitability, and portfolio quality. Conclusions of the report include:
- Funders most likely to lend to smaller, younger, less profitable, and lower portfolio quality-bearing MFIs are local funders who are closest to the MFIs and thus have the best knowledge about them.
- Funders least likely to finance MFIs from the lower quartile are foreign or more mainstream financial players, for whom fixed costs are too high to evaluate small local actors.
- Small improvements in size, age, or profitability quickly increase the pool of potential funds.
Data Brief No. 6 is available in English on the MIX website, and the Funding Structure Data can be accessed through the MIX Market by clicking here.
