14th World Summit on Management Sciences (Part II)
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Accepted Abstracts

Determinants of Financial and Operational Sustainability of Microfinance Institutions in Ethiopia

Dilgasa Bedada Gonfa*
Bule Hora University, Ethiopia

Citation: Gonfa DB (2021) Determinants of Financial and Operational Sustainability of Microfinance Institutions in Ethiopia. SciTech Management Sciences 2021. 

Received: December 11, 2020         Accepted: December 16, 2020         Published: December 16, 2020


Grassroots of people in developing countries have been given access to formal financial services through microfinance programs. FSS and OSS has been defined by various researchers differently. As such there is no clear cut definition of the word FSS and OSS. So, this study was conducted to fill the gap. From the total of thirty four MFIs which are operating in the country and fifteen MFIs have been selected for the study by way of a purposive sampling technique. This study is based on quantitative research approach using panel data and multiple regression model and Audited Financial statement data for eight years are collected by using secondary data from NBE, from the annual bulletin of AEMFI and mix-market database. The study used SPSS version 24.0 and STATA version 13.0 to conduct analysis. The study shows that MFIs in Ethiopia at the period financially not self-sufficient but operationally self-sufficient. Therefore Researcher recommends that to made sustainable MFIs in Ethiopia should have increases yield gross loan portfolio, and inception that increases return on assets habit for in sources then serving the borrower at lower possible expenses and add the value of return on assets rather than grant finance that funding donation from NGOs and regional government and minimize cost per borrower that increases sustainability of FSS and OSS.
Keywords: FSS, OSS, MFIs, Ethiopia