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AbstractThe growth and financial sustainability of a firm is tied to its ability to retain existing and potential clients. On the contrary, the defection of customers has a huge implication on firms including microfinance institutions (MFIs), suggesting that the attainment of customer loyalty is an important strategy for MFIs to improve their performance. Hence, this study attempts to investigate the level of loyalty demonstrated by rural microfinance borrowers toward their respective service providers. To accomplish this, an unbalanced panel data, comprising 1101 unique MFIs and spanning the timeframe 2010–2018, were obtained from the World Bank database and thereafter subjected to conventional econometric techniques and a series of robustness tests, including endogeneity‐corrected methods, alternative proxies, and sub‐sample analyses. The findings indicate that rural microfinance borrowers generally demonstrate loyalty to their service providers, particularly when measured by borrower retention rates; however, these findings vary with the adopted techniques, sub‐samples, and proxies employed during the analysis.

Considering the definitive role of women in microfinance industries, the study has examined the participation of women in various management roles and clients base of the South Asian microfinance market. By so doing, secondary data were obtained from the World Bank database, which incorporated the microfinance information exchange (MIX) dataset for free and easy access to global data on microfinance institutions (MFIs). The data used in this study span the period 2011–2018 (excluding female borrowers), and include six South Asian countries –Afghanistan, Bangladesh, India, Nepal, Pakistan and Sri Lanka. Methodologically, the study relied on descriptive types of analysis in line with the context of the research. The findings revealed a disadvantageous and disproportionate representation of women in various management roles relative to the client base of MFIs. Moreover, average female participation rates (excluding female borrowers) in the South Asian microfinance market in tandem with the female labor force participation rate were observed to be lower than the global average; thereby, raising concerns about the poor gender diversity in this part of the world.

Multiple borrowing in microfinance is caused by factors from both the demand and supply sides and poses a credible threat to the long‐term sustainability of the sector.

AbstractPromoting gender diversity at different organizational levels remains one of the hotly debated issues in recent years. Motivated by the paucity of research in this area, our study aims to investigate the impact of female managers on the credit risk of microfinance institutions (MFIs). We have collected data from 1004 unique MFIs across 96 countries, covering the period of 2010 to 2018, using the World Bank Mix Market data catalog. The data were then analyzed using several conventional tools and techniques, including endogeneity‐corrected estimators. The findings revealed that the presence of female managers lowers the credit risk of MFIs. The result mostly remains consistent and robust across different techniques and proxies. Therefore, promoting gender diversity at the managerial level could promote the long‐term sustainability of MFIs.

PurposeEarlier studies on employee turnover have invested enormous scholarly mileage to understand and address human resource challenges. Considering the substantial evidence on the negative and non-linear relationship between employee turnover and firms' performance, the purpose of this study is to investigate the effects of employee turnover on the social outreach (e.g. breadth of outreach) of microfinance institutions (MFIs), also known as the financial inclusion agenda of the Sustainable Development Goals.Design/methodology/approachTo achieve the study objective, the authors collected unbalanced panel data of 1,391 MFIs, covering a total of 96 economies and a period of 2010–2018. The organizational and macroeconomic data were obtained from the World Bank's Mix Market and World Development Indicators databases, respectively, and subsequently analysed using the pooled ordinary least squares, random effects model, fixed effects model and generalized method of moments.FindingsOverall, the authors found that employee turnover has a positive impact on the social outreach of MFIs, which suggests that employee turnover reduces organizational blindness and groupthink, potentiates efficiency gains and minimizes retention costs. On the contrary, this study does not find evidence of a non-linear effect of employee turnover on the outreach objectives of MFIs. Meanwhile, these effects were observed to vary depending on the proxy, sub-samples and techniques used in the analysis.Originality/valueMotivated by the paucity of literature, the study has uniquely investigated the effect of employee turnover on the social outreach objective of MFIs by using relatively recent and global-level data. The study findings can help managers and the human resource departments to make optimum decisions about employee turnover management.

AbstractConsidering the importance of promoting gender equality, Microfinance Institutions (MFIs) have emerged to reduce the gender gap by supplying credit opportunities to women. However, the microfinance literature has largely focused on the role of women in the client base while devoting less attention to their representation in the organizational structure of MFIs. This study aims to fill this gap. Using ANOVA and random effects models, our purpose is to investigate which types of MFIs more intensively promote gender equality within their workforce, at any of the organizational ladders. We analyze data from 1222 MFIs across 102 developing countries from 2010 to 2018. Empirical evidence reveals that the presence of females in both the workforce and the client base is significantly lower in commercially motivated MFIs (e.g., banks and other for‐profit institutions) compared to non‐government organizations (NGOs), and —to a lesser extent— credit unions, cooperatives and rural banks. Our results suggest that the microfinance sector would benefit from a stronger emphasis on NGO‐driven initiatives to promote female representation in terms of both employment opportunities and access to credit.

AbstractMicrofinance is a preferred development tool in many developing countries around the world; however, the industry has been facing many challenges in recent years, including the attainment of financial sustainability. Therefore, this study is aimed at investigating the effect of employee turnover on the financial performance of microfinance institutions (MFIs). The study utilized unbalanced panel data of 1561 unique MFIs from 2010 to 2018. The data were then analyzed by conventional econometric techniques such as the pooled ordinary least squares, random effects model, fixed effects model, Hausman–Taylor, and the two‐step system generalized method of moments. Considering the linear relationship, it was discovered that employee turnover has a negative effect on the financial performance of MFIs. However, this relationship is dependent on the proxies of financial performance, legal status, location, profit orientation of the MFIs (for subsample analysis), and the technique(s)/model(s) employed in the analysis. Furthermore, the study did not find empirical evidence to support the quadratic relationship between employee turnover and the financial performance of MFIs. The outcome of this study advances important policy implications for concerned stakeholders.

AbstractWe use a database composed of 2,545 Microfinance Institutions (MFIs) worldwide for the period 2008–18 to explore the effect of a larger share of women's workforce on both staff wages and overall monetary compensation within MFIs. MFIs are different from other industries, as they are traditionally women‐centered, i.e. they have a significant share of women employees at every level of the corporate hierarchy and mostly serve women clients. Applying both traditional estimation methodology and techniques aimed at accounting for possible endogeneity among the main variables, we find that a higher proportion of women on staff significantly increases the average expense per worker (which also includes the incentive components of remuneration) while the effects are considerably smoothed (or not significant) on the base salary. This leads us to conclude that, unlike what is seen in other sectors of the economy, MFIs do not pay women less. Yet, significant positive effects of women in the workforce, especially on average overall monetary compensation, suggest that women are likely to exploit their superior skills and/or gender affinity advantages with customers of the same gender to enhance MFIs' efficiency and profitability, thereby achieving higher incentive compensation, mostly in the form of bonuses and other benefits.

Purpose
Uncontrollable brain drain (employees' turnover) has been found to hamper humanitarian and sustainable objectives of socially oriented organizations. Hence, this study aims to explore the roles of gender and organizational-level factors on the rate of employees' turnover in microfinance institutions (MFIs).


Design/methodology/approach
The study used an unbalanced panel data of 235 MFIs spanning the period 2010–2019. Based on the availability of the required data set on the World Bank catalogue (in collaboration with Microfinance Information Exchange-MIX Market), this study covers four South Asian countries, namely, Bangladesh, India, Pakistan and Sri Lanka. Then, the authors analyzed the data using the conventional panel data regression techniques (e.g. fixed effects model and random effects model).


Findings
The regression results revealed that women leaders (board members) could significantly reduce the employee turnover rate of MFIs. Although the efficiency wage hypothesis is supported in this study, it depends on the profit orientation of the MFIs. This study also confirmed that financial sustainability and donations have helped MFIs to reduce their employees' turnover, which reiterates the image and brand value effect of MFIs. Moreover, the overall gender development and legal status (e.g. Bank and Non-Bank Financial Institutions) have also been found to have an effect on employees' turnover based on the sub-sample analysis.


Originality/value
To the best of the authors' knowledge, the study is among the first to investigate the impact of gender and institutional characteristics on employees' turnover based on a large and recent panel dataset from selected South Asian countries.