Regulation and performance of microfinance institutions within the West African Economic and Monetary Union

Regulation and performance of microfinance institutions within the West African Economic and Monetary Union

Author: 
Ali, Hadizatou
Place: 
London
Publisher: 
Adonis & Abbey Publishers
Date published: 
2023
Record type: 
Responsibility: 
Gueyie, Jean Pierre, jt. author
Bergeron, Claude, jt. author
Journal Title: 
African Journal of Business and Economic Research
Source: 
African Journal of Business and Economic Research, Vol. 18, No. 3, 2023, pp. 7–25
Abstract: 

This study assesses the performance of microfinance institutions (MFIs) in the West African Economic and Monetary Union (WAEMU) following changes in regulation in 2007, including the adoption of prudential capital and liquidity ratios. Analyses of data for the period 2002-2015 show that the 2007 law has had a global negative impact on financial performance, presumably due to the costs and constraints of implementation and the respect of all its provisions. The marginal effect of the minimum capital and the minimum liquidity requirements on financial performance was positive. The impact of regulation on social performance was positive, with a decreasing marginal effect for capital and liquidity. Overall, the net effect of the law on social performance was weakly positive. These results call regulators to avoid a "one size fits all" policy for MFIs in the WAEMU.

Language: 

CITATION: Ali, Hadizatou. Regulation and performance of microfinance institutions within the West African Economic and Monetary Union . London : Adonis & Abbey Publishers , 2023. African Journal of Business and Economic Research, Vol. 18, No. 3, 2023, pp. 7–25 - Available at: https://library.au.int/regulation-and-performance-microfinance-institutions-within-west-african-economic-and-monetary-union