Longitudinal analysis of microfinance borrowers in Brazil: A dynamic market segmentation

Abstract

This study uses a dynamic modelling approach to group clients of a microcredit programme in Brazil and follows them over time. Five segments are identified based on variables related to business, owners, families and operations performed within the programme. Results show that borrowers' circumstances are diverse and different actions are needed for each group. Many customers remained in the same segment; some moved to segments with worse conditions. However, the fact that one fourth of borrowers improved conditions is promising, considering the risky nature of entrepreneurial activity and the Brazilian economic context. Our analyses show that mission drift does not occur.

Strategic alliances and social performance of microfinance institutions in Indonesia

“…The performance of MFIs includes social performance and financial performance (Caballero‐montes & Labie, 2021; de Souza et al, 2021; Roy et al, 2018). Social performance is related to MFI's social mission, which helps people living in poverty by providing loans to individuals, households, and micro‐enterprises with limited or no access to financial institutions (Adusei, 2021; Hermes & Hudon, 2018).…”

“…MFIs performance consists of social and financial performance (de Souza et al, 2021; Hermes et al, 2011; Roy et al, 2018). Social performance has not been studied much, namely the impact of MFIs on people experiencing poverty around an MFIs operating area and the social responsibility of MFIs to community (Adusei & Sarpong‐Danquah, 2021; Gutierrez‐Goiria et al, 2016; Hermes & Hudon, 2018; Homaid et al, 2017; Chidambaranathan, 2020).…”