Microfinance Research Research Articles

Mapping microfinance research to sustainable development goals: Insights from Scientometrics and BERTopic analysis

AbstractMicrofinance research plays a pivotal role in addressing global development challenges, yet comprehensive assessments of its alignment with sustainable development goals (SDGs) remain scarce. This study fills this gap by systematically mapping the landscape of microfinance literature to its corresponding SDG contributions. Leveraging data from Scopus and SCIval, we analyzed 1004 microfinance articles spanning between 2014 and 2023. Our findings reveal a substantial body of research focused on poverty alleviation (SDG 1) and economic empowerment (SDG 8), with notable attention to gender equality (SDG 5) and reduced inequalities (SDG 10). Key thematic clusters include the performance and impact of microfinance institutions (MFIs), microinsurance innovations, and Islamic microfinance. Notably, top‐cited articles underscored the sector's commitment to poverty alleviation and economic growth, with a nuanced exploration of gender dynamics and rural household impacts. Furthermore, our BERTopic analysis unveils the multidimensional nature of microfinance research, highlighting prevalent themes such as MFI performance and rural household impact. Geographically, research efforts are concentrated in the United States, India, and France, reflecting a global commitment to SDG‐aligned microfinance interventions. The paper's theoretical contributions lie in its framework development, interdisciplinary engagement, nuanced understanding of microfinance themes, global perspective, and methodological advancements, all of which enhance the scholarly discourse on microfinance's role in achieving SDGs.

Pengembangan Keuangan Mikro Islam untuk Mengatasi Kemiskinan dan Mencapai Tujuan SDGs: Pendekatan Bibliometrik

This study tries to review research on sustainable microfinance development in Scopus indexed journals. This analysis uses descriptive statistical analysis based on 319 selected papers related to microfinance sustainable development from both national and international journals. All samples of published journals have been published for 27 years from 1996 to 2022. The data is then processed and analyzed using the VOSviewer application program to find out the bibliometric visualization map for sustainable development of microfinance research. The results of this bibliometric mapping study show a map of the development of research in the field of microfinance sustainable development. This study also found a close relationship between microfinance sustainable development and the main goal of the SDGs, namely eradicating poverty to promote prosperity for all people of all ages around the world. This research finds new and interesting keywords for further research.

Symmetric and Asymmetric Effects of Attitude and Satisfaction on Sustainable Business Growth

Microfinance plays a crucial role in fostering economic development, especially in underserved and impoverished communities. Using stimulus-organism-response (SOR) theory, the study investigates how microfinance, cost of loan, and individual funding and support affect borrowers' business attitudes and sustainable business growth, as well as the impact of satisfaction with these sources. The study collected 845 data points from the Khulan division of Bangladesh using a convenient sampling technique and analyzed them with Smrt Pls 4 and fsQCA 3 software. The results indicated that microfinance, cost of loan individual finding, and support significantly affect borrowers’ business attitudes which in turn has a positive effect on sustainable business growth. The findings further show that apart from the relationship between microbusiness and business attitudes, business satisfaction does not moderate the relationships between cost of loan and business satisfaction as well as individual finding and support and business satisfaction. The study suggests insightful recommendations for academics, MFIs, and policymakers for poverty reduction through ensuring sustainable business conducted by microfinance. This study introduces two new concepts i.e., individual funding and support and business satisfaction as well as a new theory i.e., SOR in microfinance research, extending the theory's applicability, and research scope, and providing new suggestions for further research.

Microfinance: A bibliometric exploration of the knowledge landscape

Microfinance has gained significant attention as a social innovation, offering flexible and low-cost financial services to households who are otherwise excluded from formal financial services. Over the years, numerous research works have expanded the knowledge base of microfinance. Applying bibliometrics, we summarise findings from 1599 articles published between 1987 and 2022. Our performance analysis reveals insights into the research trend, including its geographical distribution, the theories under examination, and the most influential publications. More importantly, the knowledge foundation and thematic analysis categorize microfinance research into three broad themes, viz. impact of microfinance, management of microfinance and performance and efficiency of microfinance. Furthermore, we trace the evolution of various research topics and forecast future trends using periodical average publication years over time. This study, therefore, serves as a valuable reference in microfinance research both for new researchers and seasoned academics, as well as policymakers, providing insights into research trends, seminal works, and future directions.

Mapping on Islamic Microfinance Research: Lesson Learn from Indonesia and Turkey

This study reviews the scientific literature on Islamic microfinance in Scopus-indexed journals. This analysis uses descriptive statistical analysis based on 345 papers from 2007 to 2023 related to the theme of Islamic microfinance. The export data was then processed and analyzed using the R-Biblioshiny application program to determine bibliometric visualization maps and topic trends in scientific literature. This bibliometric mapping research shows the mapping of sources, authors, affiliations, countries, documents, keywords, and thematic maps. This research finds that Islamic microfinance is essential in financial relations and sustainable development because it aligns with Islamic principles and encourages inclusive economic growth. In addition, this research also discusses more about Islamic microfinance from Indonesia and Turkey.

İSLAMİ MİKROFİNANS ARAŞTIRMALARINDA MEVCUT TARTIŞMALAR VE GELECEK GÜNDEMLER: SCOPUS VERİTABANINA DAYALI BİR BİBLİYOMETRİK ÇALIŞMA

The main purpose of this study is to encapsulate the major themes and their inter-linkage within Islamic microfinance research and to highlight the important gaps by recommending future research areas of worth investigation. The Scopus database is used for this bibliometric analysis. Using a robust selection criterion, 89 research articles were finalized to conduct the analysis. For the visualization and presentation of results, various software were used, such as R, RStudio, VOSviewer, and Microsoft excel. Results of content analysis and literature mapping show that most of the available studies on Islamic microfinance are theoretical and cover the topics of Islamic microfinance models, importance as a tool for poverty alleviation, and integration of Islamic commercial and social finance. There is an ample research gap in this area, and there are various avenues that could be explored in future research. In comparison with other studies on the same area using the same methodology, this study presents the various research agendas, areas and ideas for future research, which makes this study a good contribution to the literature.

Microfinance Research in India During 2001–2021: A Bibliometric Analysis with Its Social Impact Using Altmetrics

Microfinance has a significant impact on the country’s development. It strives to support economically disadvantaged communities in achieving higher levels of wealth development and income security for both households and entire communities. It assists small loans to initiate micro-level business activities which fosters financial autonomy among them. It also ensures better society and growth of a nation. The objective of the study is to map the preceding research direction in the field of microfinance in India and offers guidance to writers and researchers entering the subject of microfinance in India by providing data on year-wise publications, citations pattern, authorship pattern, types of documents preferred by the researchers, preferred sources of communication and institutions mostly associated with microfinance-related literature in India. The study also covered the critical issues related to growth of microfinance in India. Major keywords used in the microfinance research and their association with other keywords, examines the preferred countries for collaboration by Indian authors in microfinance-related studies, and the social impact of top cited articles published during the study period.

Frontiers in microfinance research for small and medium enterprises (SMEs) and microfinance institutions (MFIs): a bibliometric analysis

This article aims to present current research trends in microfinance for small and medium enterprises (SMEs) and microfinance institutions (MFIs), as microfinance plays an increasingly role in entrepreneurship development and poverty alleviation. The study uses a bibliometric analysis, in this work, we performed citation, bibliographic coupling, and keyword evolution analyses. The results show that research in microfinance for SMEs and microfinance institutions continue to grow. The authors found that recent research in microfinance for SMEs and microfinance institutions has evolved around eight thematic clusters, covering (1) access to and constraints on microcredit for SMEs (2) microfinance and economic empowerment, (3) sustainability of MFIs, (4) creditworthiness, microfinance technology infrastructure and financing patterns, (5) Islamic financial inclusion, (6) credit assessment models for microcredit, (7) microfinance and innovative business models, and (8) gender and equity crowdfunding. Research gaps in each of the thematic clusters are identified. Topics related to COVID-19, Islamic social finance, microfinance institutions, credit scoring models, crowdfunding, and entrepreneurial finance are likely to feature in the domain of microfinance and sustainability of MFIs in future.

Governance and the double-bottom-line performance of microfinance institutions: evidence from Bangladesh

PurposeThis study aims to examine the impact of governance on the double-bottom-line performance of microfinance institutions (MFIs) in Bangladesh.Design/methodology/approachThis study relies on three dimensions of corporate governance (CG) practices, that is, functions of the board of directors (BoD), top-level management activities and external governance mechanisms. This study uses panel data econometrics, particularly pooled OLS, fixed effects and two-stage system generalized method of moments to deal with potential endogeneity concerns. The panel data set covers 1,200 MFI year observations from Bangladesh for the period between 2005 and 2019.FindingsThe findings show that the presence of stakeholders on boards plays a critical role in MFIs. The dual goals of MFIs are influenced by board size, board independence and CEO duality. Internal management activities, risk perceptions and external governance also impact MFIs’ performance. Women on board have an inverse association with outreach. The activities of female managers have a significant impact on depth of outreach.Research limitations/implicationsLike many others, this study also admits the data constraint issues in microfinance research. CG data for MFI are mostly unavailable in the public domain; therefore, this study must rely on third-party data sources. This study only includes MFIs that has data for all variables of interest.Practical implicationsGovernance attributes in hybrid organizations are constituted differently. To warrant multistakeholder engagement, there is a need to develop a distinctive governance manual for hybrid organizations like MFIs.Social implicationsThis study proposes adopting a Social Director on the BoD to ensure the scope of outreach depth, given the importance of social goals in MFIs.Originality/valueThis study contributes to the ongoing debate on microfinance governance, addresses the issue based on different theoretical aspects using a country-specific data set and uses dynamic panel models to deal with potential endogeneity concerns.

Islamic Microfinance as Social Finance in Indonesia

Islamic microfinance is one of the Islamic social and financial instruments in increasing the productivity of MSMEs, which helps the country's economic development by providing capital. This study aims to determine the development map and trends of published research on the theme of Islamic microfinance in Indonesia. Data analyzed from more than 54 research publications Scopus indexed. The export data is then processed and analyzed using the R Biblioshiny application program to find the bibliometric map of the development of Islamic Microfinance in Indonesia. The research results show that the number of publications on the development of Islamic microfinance research in Indonesia continues to increase, where the results of the co-occurrence network of this theme show that there are four varied characters. At the same time, the thematic map divides it into four quadrants: dropping or emerging themes, basic themes, highly developed and isolated themes, and motor themes. In addition, this study also analyzes the most popular trend maps from journals, authors, affiliations, countries of correspondence and most cited countries.

Development of Islamic Microfinance

This study tries to review research on sustainable microfinance development in Scopus indexed journals. This analysis uses descriptive statistical analysis based on 319 selected papers related to microfinance sustainable development from both national and international journals. All samples of published journals have been published for 27 years from 1996 to 2022. The data is then processed and analyzed using the VOSviewer application program to find out the bibliometric visualization map for sustainable development of microfinance research. The results of this bibliometric mapping study show a map of the development of research in the field of sustainable development microfinance. This study also found a close relationship between microfinance sustainable development and the main goal of the SDGs, namely eradicating poverty to promote prosperity for all people of all ages around the world. This research finds new and interesting keywords for further research.

Examining the determinants of loan default among microfinance banks’ borrowers in Kano State, Nigeria

Abstract: Purpose: The study examines how the personal and business characteristics of micro, small and medium enterprise (MSMEs) borrowers of microfinance banks influence loan default, using Kano State as a case study. Research Methodology: The study employed a survey research method and the sample was drawn through multistage stratified random sampling and comprised 544 beneficiaries of microfinance banks selected from 10 local governments across the state. Data was collected using questionnaires and analyzed using Logit and Probit models with the aid of STATA 13 software. Results: The findings revealed that family size, gender, and business age are significant determinants of loan default. Borrowers’ marital status and age as well as the size and location of business were found to be insignificant in predicting loan default among microfinance MSME borrowers. Limitations: Part of the limitations of this study is the difficulty involved in getting the required information from the sampled microfinance beneficiaries. This research considered only personal and business characteristics of microfinance banks’ borrowers as determinants of loan default in some selected areas of Kano State. Findings in other areas may differ. Contributions: This study contributes to the area of microfinance research by adding more value to the knowledge and literature existing in this field. Managers of microfinance banks will also find the outcome of this research useful as it will assist them in understanding the appropriate strategies to adopt in minimizing the default rate of their clients. Keywords: 1. Borrowers 2. Loan default 3. Microfinance

Scientometric Analysis on Islamic Microfinance

Islamic microfinance means a program that provides small loans to underprivileged people to undertake entrepreneurial projects that generate income to meet their personal needs based on shariah principle.Recently, Islamic microfinance has become an important research point, especially in developing countries. This study aims to determine the development of Islamic microfinance research trends published by leading journals on Islamic economics and finance. The data analyzed consisted of 208 indexed research publications. The data is then processed and analyzed using the VoS viewer application to determine the bibliometric map of the development of Islamic microfinance research. The topic trends in the last period are sharia, micro, finance, social, evidence, institutions, and factors, where the topic of finance is the most widely used in the 2019 period.

Methodological Dilemma in Microfinance Research: Applicability of a Qualitative Case Study Design

This paper sheds light on the methodological dilemma in microfinance research and examines the feasibility of conducting a qualitative case study. Microfinance research is dominated by quantitative impact studies. However, the issues of process and implementation are critical to make an impact. The paper argues that a qualitative case study method can be used as a supplement or an alternative to quantitative methodology, because it is context-specific and naturally enquires research problem. The in-depth and in-detail inquiry make the findings more robust, and readers can understand the meaning holistically by reading stories and quotes. The case study can be used to prove microfinance impacts and to improve microfinance practices.

Stakeholders on Board: Impact in Microfinance Sustainability and Social Outreach

Purpose: This study develops an applicable governance structure based on multi-theoretical approach with relevant factors by using Bangladesh as a case study for doing microfinance governance research by considering stakeholders participation on board and its impact on double bottom-line performances. Design/Methodology/Approach: This research utilized longitudinal dataset (80 MFIs with 13 years and 1040 observations), with econometrics modelling to ascertain cause and effect relationship among the variables. Findings: In view of ‘social-welfare & commercial logic’ it found MFI’s services to the poor are non-linearly influenced by profitability. If MFIs pursue high profit it tends to decrease the outreach. It contributes the existing literature by supporting stewardship theory that is CEO duality is important for developing countries. It develops new dimensions of variables considering MFIs age and size as a moderating role based on stakeholder and resource dependence theory which explain the positive and significant impact on dual performances. Practical Implications: The findings of this study suggest that MFIs can appoint a social director, as the microfinance board of directors, have to make sure that the MFIs follow the social duty. This kind of directors has been representing the clients for the MFIs. Originality/Value: This study has emphasized on governance indicators by considering board effectiveness which may be prejudiced by MFIs’ competency. Meanwhile, board associates should uphold stakeholders’ wellbeing rather than administrations. Ensuring microfinance governance there is a necessity for comprehensive superintendent principles. Limitation/Implication: This study copes with limitations considering data availability, time constraint, geographical, or cultural differences, etc. In Bangladesh, there is no centralized data based on microfinance research. It is persistently afflicted by information limitations. So, future research may consider those approaches and develop the extent of MFIs’ outreach to the poor as well as institutional sustainability.

Science Mapping of the Global Knowledge Base on Microfinance: Influential Authors and Documents, 1989–2019

The use of microfinance in poverty alleviation and, by extension, as an instrument for sustainable social and economic development, represents a novel idea in sustainable finance. This study employed science mapping to examine 4049 Scopus-indexed documents explicitly concerned with microfinance. The goals of the review were to document the distribution of microfinance literature by type, volume, time, and geography, and to identify influential authors, articles, and a potential intellectual structure of this knowledge base. The first microfinance research was conducted in 1989, but the field attracted increased attention only after 2006, when the Nobel Peace Prize was awarded to microfinance pioneer Muhammad Yunus. This study does not find any single dominant school of thought in the field of microfinance, but rather identified three thematic research clusters: (1) a concentration on institutional aspects of microfinance, (2) scholars who used sophisticated research methods to evaluate the impact of microfinance, and (3) groundbreaking microfinance literature related to social justice more generally. As the first-ever, comprehensive bibliometric review of research on microfinance, this study provides benchmarks against which to assess the future evolution of this literature, a reference for scholars entering this domain, and targets for future development of this field of sustainability scholarship.

Toward a realistic theory of social entrepreneurship (NGOs) grounded on microfinance research: Selling dreams to society

AbstractSocial entrepreneurs sell dreams of solving a social problem of a segment of society to entice a broader segment of society to subsidize their ventures. They are motivated by a combination of passion and compassion, need for creativity, problem solving, and esteem. They sell their dreams by storytelling and narratives in order to obtain subsidized resources. In order to achieve their goals, they need to demonstrate the impact for the continuance of subsidies. Too much financial profit leads to withdrawal of subsidies.

Convergence of the performance of microfinance institutions: A decomposition analysis

In this paper, we focus on investigating whether and to what extent patterns of performance microfinance institutions converge over time. In particular, we analyze whether patterns of performance are related to changes in operating efficiency, capital deepening, and/or technological change for a large international sample of microfinance institutions for the period 2003–2012. We apply intertemporal Data Envelopment Analysis, a methodology that has been used extensively in the literature explaining patterns of economic growth, but has not been applied yet in microfinance research. We decompose performance changes into operating efficiency changes, changes in capital intensity and/or technological change and find that capital deepening is the most important source of improved performance, especially during the first half, while capital deepening and technological innovations are important during the second half of the period. We also find strong evidence for convergence of performance between microfinance institutions. These trends concur with important changes in microfinance, such as increased commercialization, competition with commercial banks, and involvement of private investors.

Third-Party Signals in Crowdfunded Microfinance: The Role of Microfinance Institutions

Crowdfunded microfinance research has routinely examined how campaign characteristics drive funding to crowdfunding campaigns but has neglected to examine the critical role of the microfinance institution (MFI). We leverage signaling theory to contend that entrepreneurs’ MFI affiliation is a salient third-party signal that shapes the performance of their crowdfunding campaign and examine how the financial and social performance of MFIs drive campaign funding. Our examination of 220,649 loans paired 173 MFIs supports our arguments. We provide insight into the importance of third-party signals in crowdfunding and into how investors seek to balance social motives with financial concerns in crowdfunded microfinance.

Does Legal Status Affect Performance of Microfinance Institutions?: Empirical Evidence from India

Transformation of non-government organizations (NGOs) to shareholder-owned microfinance institutions (MFIs) is an on-going debate in the field of microfinance research. Institutionalists support the transformation, whereas welfarists argue that NGOs are better conduits in serving poor clients. Prior studies on the impact of legal status of MFIs on their performance document mixed results. This study empirically investigates the extent to which the transformation is justified by examining the impact of legal status on the performance of MFIs in India. Using both univariate ( t-test and rank-sum test) and multivariate (random effect model) regression analysis on a dataset of 57 MFIs over the period of six years from 2008–2009 to 2013–2014, the study finds that the NGOs have better financial and sustainability performance than non-banking financial companies (NBFCs), but with respect to social performance both are indistinguishable. Further, the former has lesser costs of operation and better portfolio quality than the latter. Therefore, NGOs outperform NBFCs with respect to all dimensions of performance except for social performance where both are equally efficient. In conclusion, the transformation of NGOs to NBFCs may not improve the performance of Indian MFIs. These findings are expected to have substantial practical implications for managers of MFIs and for policymakers in framing policies for Indian MFIs.