Shedding Light on Microfinance Equity Valuation: Past and Present

O'Donohoe, Nicholas P.; Frederic, Rozeira de Mariz; Littlefield, Elizabeth; Reille, Xavier; Kneiding, Christoph

doi:10.2139/ssrn.2619149

Cited by 12 publications

(5 citation statements)

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“…The rest came from personal savings, friend/family support and loans from other banks (Figure 3). The high proportion of the clients who funded their business from microcredit demonstrates the important role it plays in the livelihoods of the clients [1,3,16,62,63]. Indeed, the clients were women and who lack collaterals to access bank loans or afford exorbitant interest on the loan offered by moneylenders in the district.…”

Section: Sources Of Capitalmentioning

confidence: 99%

“…Loans granted range from GHC500 to over GHC10, 000 1 , depending on period of participation, type of business and mainly the ability to repay. About 82% of new clients received from GHC 100-500, 30% repeated clients received GHC1,501-2,000, 26% of permanent clients received GHC3,501-4,000 and 54% of exit clients received more than GHC4,000 (Table 2).…”

Section: Amount Of Loan Obtainedmentioning

confidence: 99%

“…Over 22% of the population of developing countries lives below $1.25 a day. Out of nearly 3 billion poor business-minded people across the world, less than 17% have access to institutional credits [1,2]. This is because, on the one hand, poor people are not well endowed and cannot provide the necessary collateral security often demanded by the banks.…”

Section: Introductionmentioning

confidence: 99%

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Does Microcredit Create Employment For the Poor? The Case of the Microcredit Scheme of Upper Manya Krobo Rural Bank in Ghana

Kt¹,

Frempong²,

Obirih-Opareh³

et al. 2015

Bus Eco J

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The microfinance industry, over the past four decades has grown to become a major development tool of the world, both in terms of beneficiaries as well as the financial inputs that it received. The microfinance concept assumes that, ceteris paribus, credit to the poor, would lead to increased jobs, household well-being and poverty reduction. However, to date, no study has established a link between microcredit and wage employment, which is critical for poverty reduction. This paper argues that microcredit is critical for survivalist self-employment but it does not necessily lead to the creation of wage employment for the jobless. This evidence is from an assessment of how microcredit has contributed to business performance of the clients of the Upper Manya Krobo Rural Bank's microcredit programme in the Eastern Region of Ghana. The paper is based on a doctoral research output that used mixed method approach to collect data from a sample of 420 exits, repeated and permanent microcredit clients. The paper is of the view that microcredit may not lead to paid employment but can help clients start, improve and expand micro-enterprises. Enterprise expansion in this context refers to adding other products/services similar to the existing activity rather than the clients establishing new employable wage enterprises for the jobless. Business and Economics JournalB us ines s a n d E cono m ic s Jo urna l

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Section: Sources Of Capitalmentioning

confidence: 99%

Section: Amount Of Loan Obtainedmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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Does Microcredit Create Employment For the Poor? The Case of the Microcredit Scheme of Upper Manya Krobo Rural Bank in Ghana

Kt¹,

Frempong²,

Obirih-Opareh³

et al. 2015

Bus Eco J

View full text Add to dashboard Cite

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“…The microfinance sector has experienced successful initial public offerings (IPOs) such as the highly publicized flotation of Banco Compartamos in Mexico in 2007. These IPOs have nevertheless been criticized by influential players, including Nobel Prize winner Muhammad Kneiding, 2009). Wall's Street Advisor Services (WSAS) has also released a set of benchmarks for investments in MFIs, the WSAS MFI Shareholder Value Indices, computed from book values (see http://www.wallsstreetadvisorservices.com/).…”

Section: Introductionmentioning

confidence: 99%

“…Using MixMarket data for the period 1997period -2007period , Galema et al (2011 apply the spanning test methodology proposed by De Roon, Nijman and Werker (2001), and confirm that investment in microfinance is beneficial in terms of portfolio diversification. O'Donohoe et al (2009) were the first to compare the performances of listed MFIs with those of financial indices. Their results are twofold.…”

Section: Introductionmentioning

confidence: 99%

Does Commercial Microfinance Belong to the Financial Sector? Lessons from the Stock Market

Brière

Szafarz

2015

World Development

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This paper is the first to draw a global picture of worldwide microfinance equity by taking full advantage of daily quoted prices. We revisit previous findings showing that investors should consider microfinance as a self-standing sector. Our results are threefold. First, microfinance has become less risky and more closely correlated with the financial sector. This convergence is associated with a decline in the proportion of women borrowers. Second, microfinance and finance shares have equivalent currency exposure. Last, introducing a self-standing microfinance sector presents few diversification benefits. This paper confirms that microfinance has changed dramatically during the last decade.

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Drivers of solvency risk – Are microfinance institutions different?

Schulte

Winkler

2019

Journal of Banking & Finance

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Shedding Light on Microfinance Equity Valuation: Past and Present

Cited by 12 publications

References 0 publications

Does Microcredit Create Employment For the Poor? The Case of the Microcredit Scheme of Upper Manya Krobo Rural Bank in Ghana

Does Microcredit Create Employment For the Poor? The Case of the Microcredit Scheme of Upper Manya Krobo Rural Bank in Ghana

Does Commercial Microfinance Belong to the Financial Sector? Lessons from the Stock Market

Drivers of solvency risk – Are microfinance institutions different?

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