Title: Exploring the entrepreneurial outreach and financial performance of microfinance institutions as hybrid organisations

Authors: Atthaphon Mumi; Sujinda Popaitoon; Tudsuda Imsuwan; Pajaree Ackaradejruangsri; Sirirat Rattanapituk; Pijak Pakhunwanich

Addresses: Mahasarakham Business School, Mahasarakham University, Khamriang Sub-District, Kantarawichai District, Maha Sarakham 44150, Thailand ' Mahasarakham Business School, Mahasarakham University, Khamriang Sub-District, Kantarawichai District, Maha Sarakham 44150, Thailand ' Mahasarakham Business School, Mahasarakham University, Khamriang Sub-District, Kantarawichai District, Maha Sarakham 44150, Thailand ' College of International Management, Ritsumeikan Asia Pacific University, 1-1 Jumonjibaru, Beppu, Oita 874-8577, Japan ' UBS Business School, University of the Thai Chamber of Commerce, 126/1 Vibavadi Rangsit Road, Bangkok 10400, Thailand ' Faculty of Business Administration, Chitralada Technology Institute, Bureau of the Royal Household Sanam Sueapa, Rajasudasambhava 60, Si Ayutthaya Rd., Dusit, Bangkok 10300, Thailand

Abstract: Microfinance institutions (MFIs) are established to offer financial services to individuals who lack access to formal loans. Previous research has discussed the hybrid nature of MFIs, which emphasises both financial performance and social impact. However, limited studies have specifically focused on the dual objectives of MFIs concerning entrepreneurial outreach. In this study, we analysed data from 1,182 MFIs of 122 countries spanning almost 20 years to provide empirical evidence supporting the role of hybrid entities in promoting entrepreneurial outreach and financial performance. Our findings reveal a positive relationship between small and medium-sized enterprises (SMEs) outreach and financial performance, indicating that MFIs that actively engage with SMEs achieve better financial outcomes. Conversely, we observe a negative impact of micro-entrepreneur outreach on financial performance. The implications of our research contribute to understanding the role of MFIs in fostering entrepreneurship and highlight the challenges associated with achieving both financial and social objectives.

Keywords: microfinance institutions; entrepreneurial outreach; social performance; financial performance; SMEs; micro-entrepreneurs.

DOI: 10.1504/IJSE.2026.151081

International Journal of Sustainable Economy, 2026 Vol.18 No.1, pp.1 - 18

Received: 09 Aug 2024
Accepted: 10 Nov 2024
Published online: 13 Jan 2026 *

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