Ownership Structure and Microfinance Institutions’ Performance: A Case of Latin America

Abstract

The purpose of the paper is to determine how financial performance and social performance is influenced by ownership status of micro finance institutions (MFIs). For this purpose, data is collected from Latin American MFIs. As dependent variables are dichotomous including NGO-type MFIs and Bank-type MFIs, we used logit and probit model. The results show that NGO-type MFIs are negatively related with financial performance and Bank-type MFIs are negatively related with social performance. The results confirm the previous studies as well as logical relations. The study negates the presence of mission drift in case of NGO-type MFIs and Bank-type MFIs that may open up a new wave of discussion and encourage future researchers to highlight antecedents of such relations.