This document gives the interpretation and calculation of the industry’s 18 most commonly used performance indicators.Four new indicators focus on social performance.
For each indicator, the Guide provides the definition, interprets its meaning, identifies potential pitfalls in its use, and provides regional benchmark values. Additionally, MicroRate added a section for each indicator, “How this relates to the traditional banking sector” to make the guide more useful to investors who are new to microfinance.
The indicators included in this guide are organized into five sections: portfolio quality, efficiency and productivity, financial management, profitability, and social performance. While many other indicators could be considered, the ones included are important indicators that, when taken together, provide a reasonable overview of the performance, risk and financial condition of an MFI as well as insight into its social performance.
Since this Technical Guide was first introduced in 2000, it has been adopted as a training manual and reference tool for the standardization of key indicators. We hope this document serves as a useful resource for investors to evaluate MFI performance.
