The interest rates and performance of MFIs in the MENA region: is there a moral issue?

Philippe Adair (1) , Imène Berguiga

1 ERUDITE - Equipe de Recherche sur l’Utilisation des Données Individuelles en lien avec la Théorie Economique

The high interest rates of microfinance institutions (MFIs) seem to oppose their social mission, and raise a moral issue. We analyse the determinants of the level of interest rates with regard to the financial performance of an unbalanced panel of 66 MFIs in nine countries of the Middle East and North Africa (MENA) region over the period 2004-2012. We differentiate internal factors (cost of capital, operating expenses and loss provisions) from the external ones (regulation, competition and inflation).The outcomes of a typology from a multivariate analysis upon the relationship between the interest rate and social performance of 53 MFIs in 2008 do not match the classification of MFIs according to Yunus and Weber, which proves irrelevant.

Mots clés: costs; performance; multivariate analysis; interest rates; MENA; microfinance institutions

Domaines: Economies et finances

Philippe Adair, Imène Berguiga. The interest rates and performance of MFIs in the MENA region: is there a moral issue?. Éthique et économique/Ethics and economics, 2015. ⟨hal-01667342⟩