Abstract :
This paper investigates the efficiency of selected MFIs using Data Envelopment Analysis (DEA). DEA can aggregate the input-output components in such situations for obtaining an overall performance measures. The three inputs namely, number of personnel, physical assets of selected MFIs, operating costs and two outputs, viz, revenues and loans were considered to evaluate the relative efficiencies of MFIs of the sample set. It can be only 41.67% of MFIs were efficient under both model of DEA and rest of the units were inefficient. 58.33% of Sample MFIs were efficient under the Variable Return to Scale (VRS) model and 41.67% under the Constant Return to Scale (CRS). The RBI has since the mid 1990s helped in attracting funding for the sector by including microfinance in the “priority sector”, to which banks are mandated to allocate a percentage of their lending. However, no specific regulation was imposed on the sector as a whole primarily because it was felt that regulation may hamper the sector’s key strengths of informality and flexibility. With minimal worker and reduced operating cost leads to reach efficient to BWDA, Grama vidiyal, SKS, Spanddana and Suryoday. Only 41.67% of MFIs were efficient under both model of DEA and rest of the units were inefficient. 58.33% of Sample MFIs were efficient under the Variable Return to Scale (VRS) model and 41.67% under the Constant Return to Scale (CRS).
