Microcredit Performance Measures

Microcredit Performance Measures

Degree of Market Formulation

Quantitative Measures Performance Evaluation

Active borrowers
Conversion ratio (loans lent as a % of applicants or outreach contacts)
Percentage of staff time spent on outreach and group formation
Number of contacts needed to find, screen, and yield clients, or efficiency of staff outreach and marketing

Development Impact

Quantitative Measures Performance Evaluation

Number of clients served
percentage increase in customer incomes
Number of businesses created, maintained, or grown
Jobs created (including self-employment)
Qualitative gains/personal development
Whether the intended results are being achieved and whether they remain appropriate
Operating Results

Quantitative Measures Performance Evaluation

Total costs per average loan
Revenues per average loan
Clients per loan officer/staff person
Staff expense as a percentage of average assets
Net interest margin
Unit cost ratio
Cost per currency unit lent
Whether annual volume of clients is increasing and whether costs are decreasing per loan
Financial Condition

Quantitative Measures Performance Evaluation

Average portfolio outstanding
Liquidity ratio
Delinqency and loan ageing reports
Ratio of losses to average portfolio outstandings
Portfolio credit risk and financial health of the organization
Required Subsidy

Quantitative Measures Performance Evaluation

Self-sufficiency ratio
The percentage of total operating costs that are met from internal revenue sources (interest on loans, interest on investments, and fee income).

Source:
Originated by ACCION International, and quoted in OECD (1996), "Microcredit in Transitional Economies" Paris: The Programme on Local Economic and Employment Development, OECD, p.74

Hari Srinivas - hsrinivas@gdrc.org
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Degree of Market Formulation
Quantitative Measures	Performance Evaluation
Active borrowers Conversion ratio (loans lent as a % of applicants or outreach contacts) Percentage of staff time spent on outreach and group formation	Number of contacts needed to find, screen, and yield clients, or efficiency of staff outreach and marketing
Development Impact
Quantitative Measures	Performance Evaluation
Number of clients served percentage increase in customer incomes Number of businesses created, maintained, or grown Jobs created (including self-employment) Qualitative gains/personal development	Whether the intended results are being achieved and whether they remain appropriate
Operating Results
Quantitative Measures	Performance Evaluation
Total costs per average loan Revenues per average loan Clients per loan officer/staff person Staff expense as a percentage of average assets Net interest margin Unit cost ratio Cost per currency unit lent	Whether annual volume of clients is increasing and whether costs are decreasing per loan
Financial Condition
Quantitative Measures	Performance Evaluation
Average portfolio outstanding Liquidity ratio Delinqency and loan ageing reports Ratio of losses to average portfolio outstandings	Portfolio credit risk and financial health of the organization
Required Subsidy
Quantitative Measures	Performance Evaluation
Self-sufficiency ratio	The percentage of total operating costs that are met from internal revenue sources (interest on loans, interest on investments, and fee income).