Performance Analysis of Banks and Microfinance Institutions in India

Subject Areas : General Management

K. Pal Narwal ¹ , S. Pathneja ² , M. Kumar Yadav ³

1 - Guru Jambheshwar University of Science and Technology, Hisar, Haryana, India
2 - Guru Jambheshwar University of Science and Technology, Hisar, Haryana, India
3 - Guru Jambheshwar University of Science and Technology, Hisar, Haryana, India

Received: 2014-12-21 Accepted : 2014-12-21 Published : 2015-01-01

Keywords: Performance, banks, MFIs, India,

Abstract :

Present paper intends to measure the determinants of performance of Indian financial sector. The performancevariables of banking sector and microfinance institutions in India are studied over a study period of six years i.e.2006-07 to 2011-12. The financial sector of India is gaining strength over the years and its contribution to growthis overwhelming. Banks are considered the main component of Indian Financial Sector. Indian banking sector isproviding new and improved financial services to economy and masses over the years. The banks have achievedthe above objective in some areas but failed to reach to other areas. To fill this gap of access MicrofinanceInstitutions were established in India. The main objective of MFIs is to reach to masses to which banks are notable to provide the services. The main intention of establishing MFIs was to fill the gap of access to financialservices by poor people. So, overall the mixed results are obtained from the study. The performance rotatesaround mainly two variables i.e. size and spread to total assets. All other variables are either negative orinsignificant or both to the performance of banks and microfinance. institutions