Women participation in achieving sustainability of microfinance institutions (MFIs)

This paper identifies the impact of different roles of female participation (i.e. female borrower, board member, manager, and loan officer) in achieving financial sustainability and outreach of MFIs. We used global panel data from 1999 to 2017 and employed panel-ordinary least square (OLS), fixed-effect model. Moreover, we employed Two-Stage Least Square (2SLS) to resolve the endogeneity problem. We found that female as a borrower, board member and manager has a significant favorable influence on outreach except for female loan officer. However, these have significant negative impact on financial sustainability except female manager. The estimates also indicate that female participation has more impact on outreach than financial sustainability. Our study have implications for devising target market strategy, recruitment, and leadership style strategy for the microfinance sector to achieve poverty reduction, gender equality, and women empowerment.

Automated summary

This study examines the impact of female participation in different roles in microfinance institutions on financial sustainability and outreach. The findings suggest that female borrowers, board members, and managers have a positive influence on outreach, while female loan officers do not. However, these roles have a negative impact on financial sustainability, except for female managers. The study also highlights the greater impact of female participation on outreach compared to financial sustainability.