A Comparative Financial Analysis of NBFCMFI in Tamilnadu with Reference to Apex Abishek Finance Ltd, Coimbatore
Abstract
Microfinance in India has been viewed as a development tool which would
alleviate poverty and enhance growth of the country through financial inclusion. Out of 6
lakh villages in India, only approximately 50000 have access to finance. India is a country
which has the highest number of households which are excluded from banking. With the
Andhra crisis of microfinance institutions and issues that microfinance institutions have a
mission drift, the aim of the paper is to study the performance and efficiency of microfinance.
A sample of microfinance institutions in Tamilnadu have been selected based on their ratings
given by microfinance information exchange (MIX) for the study. The performance of these
sample MFIs as well as their performance with respect to commercial banks in India have
been studied using statistically tools. A microfinance institution is measured for financial
sustainability based on its good financial accounts and the recognized accounting practices
they follow according to Meyer (2002).
Data for the microfinance institutions have been collected from Microfinance information
exchange (MIX) where few of the MFIs have started reported their financial data. The
financial parameters of these MFIs are studied and compared with the financial parameters of
other MFIs and their financial performance can be analyzed. International best practice in
microfinance around the world suggests good financial analysis is the basis for successful and
sustainable microfinance operations. Some would even say that without financial analysis
MFI will never achieve sustainability. Sustainability means relying on commercially priced
and internally generated funds rather than on donors for growth