Performance Evaluation Of Microfinance Institutions And Case Studies

In the development process, microcredit has been the attention of governments and played a positive role in promoting economic development. Microcredit originated in the 20th century, 80’s, when the State issued to poor farmers on subsidized loans, but repayment is not ideal. It is increasingly recognized that we need some market-based solutions. In China, the central bank launch wide range pilot projects of MFI to ease the financing of SMEs, and promote rural financial development. At the very beginning, microfinance was introduced to China as an effective anti-poverty tool, and has played a positive role in the eradication of rural poverty. According to the development of microfinance in China situation, it is seen as a financial service for the low-incomes and SMEs.The significance of microfinance institutions is that providing loans for the low-income people while achieving their own sustainable development. But in the actual analysis, we can not think that every business with microfinance institutions operates in that way. This article describes the widely accepted internationally social performance evaluation frame of MFIs and financial sustainability evaluation system. Performance evaluation system is composed of intent, process and results. From the company mission, corporate governance, staff development, price transparency, customer retention, market research and other aspects, this frame investigates whether the object has a comprehensive evaluation system to ensure the realization of social performance. Financial viability, also known as the financial sustainability indicators index, Includes the revenue/cost comparison.Taking into account that some of the microfinance institutions getting subsidies and donations as the capital, some scholars have proposed to compare the financial cost after excluding these factors. Therefore, indicators of financial viability, there are two forms. In addition, in order to more fully assess the financial situation, the paper reviews general indicators in the financial performance as a useful complement to the above formula.The last part is the introduction of the establishment of Fullerton credit, operation mode, operating profile. Then I use the above assessment indicators, evaluate their social performance and financial sustainability, put forward appropriate recommendations for improvement. The lack of industry data, the difficulties to accessing company’s information made the assessment process incomplete. But for people who concern about the development of this industry, this type of attempt is useful. I believe that such an attempt can help to give regulators, investors, potential investors or academics a new perspective, to arouse the awareness of practitioners to standardize their operations.