Determinants of the financial performance of microfinance institutions in Central Asia

Abstract

This article analyses the determinants of the earnings performance of microfinance institutions in Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan, Azerbaijan, Mongolia, Afghanistan and China in 1998–2011. It confirms that targeting women borrowers improves the financial results of microfinance institutions whereas the effectiveness of group lending or advantages of rural lending, in contrast to the initial expectations, were not confirmed. It also considers the contributions of different governance forms of microfinance institutions and the macroeconomic factors potentially influencing the financial performance of microfinance institutions.