Financial Performance of Microfinance Institutions in Ghana and Uganda: Development and Application of the Achievement Stages Model


Dr. Johannes Flosbach

Research Area:


Microfinance institutions (MFIs) provide financial services like loans, savings, insurances or money-transfer to low-income households. A prerequisite for sustainable and independent institutions, but also for donor driven projects, is a good understanding of the financial consequences of microfinance activities for the provider. Especially in regards to the African context this issue is subject to guessing, contraditions or anecdotal evidence.

Therefore, the research project analyses the quantitative and qualitative factors that influence the financial performance of MFIs. The major subtopics are the income situation of an institution, mainly the recovery rate of loans, efficiency and productivity, corporate governance, and refinancing.

Interviews and in-depth observations, as well as analysis of financial statements, publications, minutes and guidelines will be conducted with a large sample of MFIs in Ghana and Uganda.

As a result the research aims to bring a higher transparency to the providers of microfinance services in regards to the business potential or cost of provision of their services, and by this to add to the financial inclusion of the poor.