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Impact of COVID-19 Pandemic on the Microfinance Institutions Growth in the EU
Sara Ravan Ramzani, Behrooz Gharleghi, Alison Watson, Phungmayo Horam
Background: This study examines the social and financial implications of EU Microfinance Institutions (MFIs) in response to the decline in economic activity caused by COVID-19.
Method: The Data Envelopment Analysis (DEA) technique is used to evaluate such impacts.
Results: The empirical results suggest that the pandemic affects MFI’s financial efficiency adversely and increases MFI’s social efficiency. MFI lending rates show the impact of COVID-19 on MFI efficiency, but the contribution of refinancing rates is negligible.
Conclusion: It is found that the pandemic reduces the economic efficiency of MFIs, while improving the social efficiency of MFIs.
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