Abstract

Outreach breadth and outreach depth are factors affecting the operations and the goals of formal microfinance institutions (MFIs) in Vietnam. The purpose of this study is to discover the interactive relationship between outreach breadth and outreach depth and to examine factors that affect the outreach breadth and outreach depth of formal MFIs. After regression analysis on a set of panel data from 2010 to 2018 of all formal MFIs in Vietnam, it appears that financial sustainability, repayment ratio have positive relationships with outreach breadth; number of branches andoutreach depth have negative relationships with outreach breadth; whiledeposit-to-loan ratio has a negative impact on outreach breadth. Debt-to-equity ratio and financial sustainability have positive relationships with outreach depth; the size growth of MFIs and loan-to-deposit ratio have negative relationships with outreach depth, portfolio at risk has a negative impact on outreach depth. The study finds bidirectional interactions between outreach breadth and outreach depth. This study helps researchers and managers to understand the key determinants for better management of formal MFIs.