Study Of Chinese Commercial Microfinance Companies’ Efficiency As For The Inclusive Financial System

Though Chinese commercial micro-credit companies boomed since 2008, how to define their efficiency is still vague and urgent. Zeller & Meyer (2000) put forward the famous triangle of microfinance’s efficiency:financial sustainability, outreach, and impact. With the change of environment, formal financial institutions develop towards the micromation and microfinance develops towards the normalization, microfinance’s efficiency should have new connotation. China is developing inclusive financial system, and commercial microfinance companies play an important role in it. Commercial microfinance companies not only fill the gaps, but also speed up the construction of inclusive financial system through its synergy to formal financial institutions.The synergy of microfinance to the formals includes micro level and macro level. Micro-synergy means that microfinance companies get funds from formal institutions to widen their outreach and improve efficiency; macro-synergy is in the view of regional economy, the cooperation between microfinance and formal financial institutions can accelerate the construction of regional inclusive financial system.The micro-synergy is reflected in the new dimension of microfinance’s efficiency’s calculation system:we add synergy to Zeller & Meyer’s triangle theory, and create "expanded triangle theory", and the indicator of synergy in DEA model is bank funding. We take the example of Zhejiang Province, and use the data of 109 commercial microfinance companies’data in 2009 to calculate their efficiency.The synergy model between commercial microfinance companies and regular financial institutions is the macro level synergy’s refection. We see the commercial microfinance and the formal finance as two subsystems of our inclusive financial system, and use synergy model to calculate their degree of coordinated development. The Zhejiang province’s data shows that the two subsystems did not develop coordinately well in 2009.In the end, we put forward a few suggestions, and these suggestions can be divided into two parts:one is about the microfinance, the other one is about the government. The microfinance companies should improve their management, pay attention to attract more talents, and develop more micro-credit skills. The government should define the status of microfinance companies as soon as possible, reduce their tax burden, and take differentiated subsidies.