Resumen de Decision making at the interplay between microfinance and crowdlending: Motivations and impacts on the funding of microfinance institutions
Affoue Marie Noëlle N'Guessan
The present dissertation analyzes the microfinance literature, pointing out the financial constraints faced by microfinance institutions (MFIs) and offering crowdlending as an alternative source of funding for MFIs.
Chapter 1 presents a review of the microfinance literature in order to create a conceptual framework articulated around the foundational logic of MFIs that outlines and explains the different organizational forms that appear among MFIs operating in developing countries. We divide MFIs into three different groups with specific governance mechanisms, capital structure, and sources of funding. Socially-oriented MFIs are those created to provide solutions to societal issues; they focus on social indicators and depend on subsidies and donations to sustain their activities. Commercially-oriented MFIs are founded to serve the poor with banking principles, looking for financial profits while using the funds provided by investment equities with a philanthropic orientation. Finally, hybrid-CSR MFIs are the international corporations solutions to poverty. Our findings indicate that MFIs are facing challenges related to their organization and funding and that these problems must be solved by the academics and practitioners to keep their promises of reducing poverty.
Chapter 2 explores crowdlending as a source of funding for MFIs. The existing literature shows that the mainstream funders of microfinance are the public and private institutions and governments. We introduce crowdlending, which is the funding in small amounts by crowds of lenders through Internet platforms, as an innovative source of liquidity for MFIs. We look at the social and financial factors influencing the funding of MFIs through crowdlending. We find that social factors, more than financial ones, influence the liquidity of MFIs active on the crowdfunding platform Kiva. Moreover, our results indicate that crowdlending could complement the resources provided by public funders and could be a substitute to constrained private funding.
Chapter 3 discusses the expansion of crowdlending in sub-Saharan Africa. In fact, as we explore crowdlending and look at how it can grow in African countries, we bear in mind its role as an alternative source of funding for many start-ups and small MFIs. Using the example of Kiva, we argue that crowdlending expansion is based on the development of a network of funders, a network of borrowers, a good organizational structure, and a vibrant platform.
