An Analysis on the Efficiency of Philippine Microfinance Institutions: A Stochastic Frontier Approach

Added Title

DLSU-AKI POLICY BRIEF, 2023-12-019

Authors

Ryan Lou Dio, De La Salle University, ManilaFollow
Elijah Jacob Mendoza, De La Salle University, ManilaFollow
Lunette Clarisse Nunez, De La Salle University, ManilaFollow
Ma. Ellory Villanueva, De La Salle University, ManilaFollow
Myrna S. Austria, De La Salle University, ManilaFollow
Tereso S. Tullao Jr, De La Salle University, ManilaFollow

College

School of Economics

Document Type

Policy Brief

Publication Date

12-2023

Place of Publication

DLSU-Angelo King Institute, Room 223, LS building, 2401 Taft Avenue, Manila 0922

Abstract

Microfinance institutions (MFIs) were created to provide loans and financial services for the poor as commercial banks have requirements that are not accessible to them. The Philippines government soon started using MFIs as a poverty alleviation tool to answer the market failure created by the commercial banking industry since it cannot accommodate the needs of low-income earners due to the high costs attached to it. However, recent studies have shown that MFIs are “mission drifting,” which means that they are deviating from their original social purpose and becoming more financially driven. As a result, this paper estimates the financial and social efficiency of Philippine MFIs using a two-step Stochastic Frontier Approach from 2005 to 2018.

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Recommended Citation

Dio, R., Mendoza, E., Nunez, L., Villanueva, M., Austria, M. S., & Tullao, T. S. (2023). An Analysis on the Efficiency of Philippine Microfinance Institutions: A Stochastic Frontier Approach. Retrieved from https://animorepository.dlsu.edu.ph/res_aki/181

Disciplines

Accounting | Finance | Finance and Financial Management | Income Distribution

Keywords

Philippines; Microfinance Institutions; Poverty Alleviation

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