Does Microfinance Institution Has Institutional Properties to Generate Savings?

Purpose - Microfinance institutions (MFIs) in Bangladesh have been providing savings services to their clients at least for the past 15 years. However, whether an MFI should have institutional requirement(s) to be a deposit-taker generates interest among academics and policy makers. Thus, this short note aims to provide a brief overview of institutional properties of MFIs. Research Design, Data, and Methodology - This study used the existing literature and reports by the Microcredit Regulatory Authority’ to investigate institutional properties of MFIs. In doing so, we have used ‘institutional theory of saving’ as a theoretical ground. Although the ‘institutional theory of saving’ has several important properties, the existing literature mostly discusses seven features such as information, incentives, facilitation, expectation, access, restrictions and security. Results - It is found that MFIs— in general— should have all the seven important institutional properties to be considered as an ideal savings institution. With regards to the microfinance sector in Bangladesh, this study supports that all the NGO-MFIs have these properties to be considered as an ideal deposit taker. Conclusions - The microfinance sector in Bangladesh needs to design and develop comprehensive and customer friendly savings products to further motivate the poor to save in MFIs.

keywords: Microfinance Institutions, Saving, Institutional Theory of Saving, Bangladesh

참고문헌

Bernheim, B. D., & Garrett, D. M. (2003). The effects of financial education in the workplace: evidence from a survey of households. Journal of Public Economics, 87(7), 1487-1519.

Beverly, S. G., & Sherraden, M. (1999). Institutional determinants of saving: Implications for low-income households and public policy. The Journal of Socio-Economics, 28(4), 457-473.

Bowles, S., & Gintis, H. (2001). The inheritance of economic status: Education, class and genetics. International encyclopedia of the social and behavioral sciences: Genetics, behavior and society, 6, 4132-4141.

Cozarenco, A., Hudon, M., & Szafarz, A. (2016). What type of microfinance institutions supply savings products?. Economics Letters, 140, 57-59.

Dowla, A., & Alamgir, D. (2003). From microcredit to microfinance: evolution of savings products by MFIs in Bangladesh. Journal of international development, 15(8), 969-988.

Han, C. K., & Sherraden, M. (2009). Do institutions really matter for saving among low-income households? A comparative approach. The Journal of Socio-Economics, 38(3), 475-483.

Lusardi, A. (2003). The impact of financial education on savings and asset (Working Paper, wp061). Michigan Retirement Research Center, University of Michigan.

Mia, M. A. (2016). Microfinance Institutions and Legal Status: An Overview of the Microfinance Sector in Bangladesh. Journal of Asian Finance, Economics and Business, 3(2), 21-31.

Mia, M. A., & Chandran, V. G. R. (2016). Measuring Financial and Social Outreach Productivity of Microfinance Institutions in Bangladesh. Social Indicators Research, 127(2), 505-527. doi:10.1007/s11205-015-0979-5

10.

MRA. (2010). NGO-MFIs in Bangladesh : A statistical publication. Dhaka, Bangladesh: Micro-credit Regulatory Authority.Retrieved June 8, 2016, from http://www.mra.gov. bd/images/mra_files/Publications/ngomfis_in_bangladesh_volume-7_june%202010.pdf.

11.

MRA. (2014). NGO-MFIs in Bangladesh: A Statistical Publication. Dhaka, Bangladesh: Microcredit Regulatory Authority.Retrieved June 17, 2016, from http://www.mra.gov.bd/images/mra_files/Publications/v-12.pdf

12.

Robinson, M. (2001). The microfinance revolution:Sustainable banking for the poor. Washington, DC: The World Bank.

13.

Schreiner, M., Sherraden, M., Clancy, M., Johnson, L., Curley, J., Zhan, M., Beverly, S.,& Grinstein-Weiss, M. (2005). Assets and the Poor: Evidence from Individual Development Accounts, pp. 185-215 in M. Sherraden (ed.).Inclusion in the American dream: Assets, poverty, and public policy. New York: Oxford University Press.

14.

Sherraden, M., & Barr, M. S. (2006). Institutions and Inclusion in Saving Policy. Law &Economics Working Papers Archive: 2003-2009. Paper 44. Retrieved June 17, 2016, from http://repository.law.umich. du/law_econ_archive/art44

바로가기메뉴

논문 상세

Vol.6 No.3

Does Microfinance Institution Has Institutional Properties to Generate Savings?

Abstract

참고문헌

Asian Journal of Business Environment