nep-mfd New Economics Papers
on Microfinance
Issue of 2016‒05‒14
five papers chosen by
Olivier Dagnelie
Université de Caen

  1. Regulation, Outreach and Sustainability of MFIs in SSA: A Multilevel Analysis By Nyanzu, Frederick; Atta Peprah, James
  2. Does Microcredit Have an Impact on Children? Evidences from Vietnam By Dinh, Cuong; Nguyen, Cuong; Pham, Phuong
  3. Mobile Money, Agricultural Marketing, and Off-Farm Income in Uganda By Sekabira, Haruna; Qaim, Matin
  4. The Status of Financial Inclusion, Regulation, and Education in India By Barua, Abheek; Kathuria, Rajat; Malik, Neha
  5. Financial technological Innovation and Access is the Key to Unlocking African Agricultural Potential: A Case Study of Dairy in Kenya By Pambo, Kennedy

  1. By: Nyanzu, Frederick; Atta Peprah, James
    Abstract: This paper brings together issues lingering around regulation in microfinance institutions by examining the effects of regulation and country effect. Using an unbalanced panel data from 2002 to 2012 for 30 countries in Sub-Saharan Africa, and employing multilevel estimation technique, the study reveals that regulation helps to improve the sustainability and breadth of outreach but not depth of outreach. Also country effect plays significant role in MFIs activities. It is imperative for regulatory authorities to devise strategies to strengthen MFIs financial position as well as ensuring enabling environment that will enhance the achievement of microfinance social objectives.
    Keywords: Regulation; Microfinance Institutions; Profitability; Outreach; Sustainability
    JEL: G00
    Date: 2016–04–20
  2. By: Dinh, Cuong; Nguyen, Cuong; Pham, Phuong
    Abstract: Vietnam has been successful in economic growth and poverty reduction. One of important antipoverty program is micro-credit for the poor. Although there are a large number of studies on the impact of micro-credit programs on income and poverty reduction, there is little evidence on its impact of children. This paper aims to evaluate the impact of micro-credit on child labor and education in Vietnam using Vietnam Household Living Standard Survey (VHLSS) 2006 and 2008. Overall, this study does not find significant impacts of micro-credit on education and labor of children.
    Keywords: Child education, child labor, microcredit.
    JEL: I3 I38
    Date: 2014–05–15
  3. By: Sekabira, Haruna; Qaim, Matin
    Abstract: Mobile money (MM) services can contribute to welfare gains in smallholder farm households. Previous research showed that one important pathway is through higher remittances received from relatives and friends. Here, the role of other impact pathways is examined, especially focusing on agricultural marketing and off-farm economic activities. The analysis builds on panel data from smallholder coffee farmers in Uganda. Regression models show that the adoption of MM technology has contributed to higher household incomes and consumption levels. Off-farm income gains are identified to be an important pathway, also beyond remittances. Typical off-farm income sources are small businesses in trade, transport, and handicrafts, which benefit from novel savings and money transfer opportunities through MM. In terms of agricultural marketing, MM users sell a larger proportion of their coffee as shelled beans to buyers in high-value markets, instead of selling to local traders immediately after harvest. MM services help reduce cash constraints and facilitate transactions with buyers from outside local regions. In conclusion, MM can contribute to rural development through various important pathways. Analysis of adoption patterns suggests that MM services are socially inclusive.
    Keywords: mobile phones, rural banking, smallholder farmers, impact evaluation, Africa, Agricultural Finance, Community/Rural/Urban Development, Consumer/Household Economics, Financial Economics, Food Security and Poverty, Research and Development/Tech Change/Emerging Technologies, O12, O16, O33, Q12,
    Date: 2016–04
  4. By: Barua, Abheek (Asian Development Bank Institute); Kathuria, Rajat (Asian Development Bank Institute); Malik, Neha (Asian Development Bank Institute)
    Abstract: India’s financial inclusion agenda has witnessed a paradigm shift over the last decade, away from an emphasis on credit to a more comprehensive approach toward financial services (e.g., opening bank accounts and offering basic financial products, such as insurance). This paper describes the structure of banking and microfinance institutions in India relevant to the developing model of financial inclusion, as well as relevant regulatory structure and modes of delivery. It explains the current state of financial inclusion, as well as regulatory changes necessary to make the new architecture for inclusion viable, including a critique of some of the recommendations of the Mor Committee on Comprehensive Financial Services for Small Businesses and Low-Income Households. The paper then reviews modes of delivery and the regulatory structure being contemplated or recently introduced. It assesses the suitability objective envisaged as critical for inclusion, associated challenge of revamping consumer protection laws, and imperative of improving financial literacy. The paper also discusses the case of micro, small, and medium-sized enterprises in the given context.
    Keywords: India’s financial inclusion; microfinance institutions; financial literacy; consumer protection laws
    JEL: G21 G28 L53 O16
    Date: 2016–05–02
  5. By: Pambo, Kennedy
    Abstract: In Kenya agriculture contributes 24% to the GDP yet lending to the sector is only about 4%. A major constraint to increasing efficiency in smallholder enterprises in rural areas is therefore, limited access to financial services. Lack of working capital for traders in rural areas inhibits the purchase, trade and processing of agricultural produce. This limits the amount of produce a farmer can market and acts as a disincentive to reaching his/her productive potential. Furthermore, most Microfinance Institutions (MFIs) lack a value chain approach to financing and are unable to remove the financial constraints along a specific value chain. Appropriate financing services along the value chain can help to enhance the productivity and profitability of various small-scale rural stakeholders. Therefore, the study assessed the prospects for financial innovations and access in improving dairy farmers’ livelihoods through a case study approach. The findings provide a strong evidence that appropriate financial innovation is the missing link in agricultural productivity paradigm and the food security equation in African countries including Kenya.
    Keywords: Agriculture, Financial access, Innovations, Farmers, Agricultural and Food Policy, Agricultural Finance, Farm Management, Q14,
    Date: 2015

This nep-mfd issue is ©2016 by Olivier Dagnelie. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.