Executive Summary

The Indian microfinance sector has experienced fundamental changes in the structure of ownership and management of microfinance institutions (MFIs). The current study seeks to evaluate the competition level of the Indian microfinance sector during the period 2005–2017 and attempts to find the cause-and-effect relationship between concentration and competition. Furthermore, it analyzes the performance of leading MFIs to explore if there is evidence of exploitation of clients by these institutions. The study is the first of its kind with explicit focus on the market structure of the Indian microfinance market. The study uses unbalanced panel data sets generated from the microfinance information exchange (MIX) data source. The representative sample includes firm specific data of 127 MFIs of different legal statuses and sizes. The dynamic equation model is estimated applying the difference generalized methods of moments (GMM). The results of the empirical investigation find a rise in the concentration with a decrease in competition in the Indian microfinance market during recent years. Intense competition in the past and introduction of new regulations in the wake of sectoral crisis are responsible for this transition. High concentration gives large MFI market powers to exploit the customers. However, the study fails to find any evidence of any such exploitation from the conduct of the leading MFIs. The survey highlights the potential connection between the drop in the competitiveness of the sector and the first appearance of new regulations in light of the sectoral crisis. It is imperative that regulators keep a tight vigil on the operations of leading MFIs and take necessary actions to ensure a healthy competitive environment in the sector. Furthermore, existing rules should be modified to help small MFIs as they play a very crucial role in the fulfilment of the primary objective of the microfinance.

执行摘要

印度小额信贷部门在小额信贷机构的所有权和管理结构上发生了根本性变化。当前的研究旨在评估印度小额信贷部门在2005-2017年期间的竞争水平，并试图找到集中度与竞争之间的因果关系。此外，它分析了领先的小额信贷机构的业绩，以探讨是否有证据表明这些机构剥削了客户。该研究是同类研究中的第一个，它明确关注了印度小额信贷市场的市场结构。该研究使用了从小额信贷信息交换（MIX）数据源生成的不平衡面板数据集。代表性样本包括127家具有不同法律地位和规模的小额信贷机构的公司特定数据。使用差分广义矩量法（GMM）估算动态方程模型。实证研究的结果发现，近年来印度小额信贷市场的集中度有所提高，而竞争却有所减少。过去的激烈竞争和部门危机后出台的新法规是​​造成这种转变的原因。高集中度赋予MFI巨大的市场力量来开发客户。但是，该研究未能从领先的小额信贷机构的行为中找到任何有关此类剥削的证据。该调查着重指出，由于部门危机，该部门的竞争力下降与新法规的首次出现之间存在潜在的联系。监管者必须对领先的小额信贷机构的运作保持严密警惕，并采取必要的措施以确保该行业的健康竞争环境。此外，应修改现有规则以帮助小型小额信贷机构，因为它们在实现小额信贷的主要目标中起着至关重要的作用。