1、原文 The Question of Sustainability for Microfinance Institutions 1.Preface Microentrepreneurs have considerable difficulty accessing capital from mainstream financial institutions. One key reason is that the costs of information about the characteristics and risk levels of borrowers are high. Relatio
2、nship-based financing has been promoted as a potential solution to information asymmetry problems in the distribution of credit to small businesses. In this paper, we seek to better understand the implications for providers of microfinance in pursuing such a strategy. We discuss relationship-based f
3、inancing as practiced by microfinance institutions (MFIs) in the United States, analyze their lending process, and present a model for determining the break-even price of a microcredit product. Comparing the models results with actual prices offered by existing institutions reveals that credit is ge
4、nerally being offered at a range of subsidized rates to microentrepreneurs. This means that MFIs have to raise additional resources from grants or other funds each year to sustain their operations as few are able to survive on the income generated from their lending and related operations. Such subs
5、idization of credit has implications for the long-term sustainability of institutions serving this market and can help explain why mainstream financial institutions have not directly funded microenterprises. We conclude with a discussion of the role of nonprofit organizations in small business credi
6、t markets, the impact of pricing on their potential sustainability and self-sufficiency, and the implications for strategies to better structure the credit market for microbusinesses. 2.The MFI Lending Model in the United States Marketing Marketing drives the business model in terms of the volume of
7、 potential borrowers that an MFI is able to access and the pool of loans it can develop. Given that MFIs do not accept deposits and have no formal prior insight into a fresh potential customer base, they must invest in attracting new borrowers. Marketing leads are generated from a variety of sources
8、: soliciting loan renewals from existing borrowers, marketing to existing clients for referrals, grassroots networking with institutions possessing a complimentary footprint in the target environment, and the mass media. At the outset of operations, before a borrower base is developed, portfolio gro
9、wth is determined by the effectiveness of marketing through network and mass media channels. Once a borrower pool is established, marketing efforts can be shifted toward lower-cost marketing to existing borrowers and their peer networks. Even so, loans will likely attrite from a portfolio at a faste
10、r rate than renewals and borrower referrals can replenish itnew leads must continue to be generated through other, less effective channels. The Loan Application Process In economic terms, the loan application process represents an investment at origination with the aim of minimizing credit losses in
11、 the future. All else being equal, a greater investment in the credit application process will result in lower subsequent rates of delinquency and default； conversely, a less stringent process would result in greater rates of credit loss in the future. Setting the appropriate level of rigor in a cre
12、dit application process is an exercise in analyzing loan applicant characteristics and forecasted future behaviors while being cognizant of the cost of performing these analyses. Three steps characterize the loan application process. Preliminary Screen. The applicant is asked a short set of question
13、s to establish the applicants eligibility for credit under the MFIs guidelines. This is sufficient to determine the likely strength of an application and whether an offer of credit could, in principle, be extended. Interview. At the interview stage, due diligence is performed to ensure that the loan
14、 purpose is legitimate and that the borrowers business has sufficient capacity and prospects to make consistent repayments. Cash-flow analysis is the core of the MFI due diligence procedure and for microfinance borrowers the data is often insufficiently formal, hindering easy examination of cash flo
15、w stability and loan payment coverage. As a result, this is a less standardized, more timeconsuming task than its equivalent in the formal lending markets. Underwriting and Approval. If a loan is recommended by an officer following the interview the application is then stresstested by an underwriter
16、, who validates the cash flow and performs auxiliary analysis to ensure that the loan represents a positive addition to the lending portfolio. The dynamics of loan origination illustrate the trade-offs to be made to ensure an efficient credit process. Improved rigor could lead to a higher rate of de
17、clined applicants, and so higher subsequent portfolio quality, but at the expense of increased processing costs. For medium and larger loans, as application costs increase past an optimal point, the marginal benefit of improved portfolio quality is outweighed by the marginal expense of the credit ap
18、plication itself. However, for small loans there exists no such balance pointthe optimal application cost is the least that can be reasonably achieved. This motivates a less intensive credit application process, administered when a loan request falls beneath a certain threshold, typically a principa
19、l less than $5,000. MFIs can disburse such loans more quickly and cheaply by fast-tracking them through a transaction-based process and context learning. Loan Monitoring Post-loan monitoring is critical toward minimizing loss. In contrast to the credit application process, which attempts to preempt
20、the onset of borrower delinquency by declining high risk loans, monitoring efforts minimize the economic impact of delinquency once a borrower has fallen into arrears. In addition to the explicit risk to institutional equity through default, managing delinquent borrowers is an intensive and costly p
21、rocess. When dealing with repeat clients, there exists the opportunity to leverage information captured through monitoring on previous loans, enabling the MFI to shorten the full credit application without materially impacting the risk filter. In short, there is an opportunity to reduce operational costs without a corresponding increase in future loss rates. Repeat borrowers enable the information accrued during the relationship to be leveraged to mutual benefit of MFI and borrower. In this case, much of the information required to validate a loan application has been gathered during the
