Our analysis shows that the diversity of institutional forms is important to foster market dimension, guarantee a good cover of the several vulnerable groups and a diversified offer of other services” (pp. 45-6). The objectives for microfinance institutions are often portrayed in terms of the ‘double bottom line’—that is both profitability (or at least break even) and social objectives such as aiding poverty reduction, promoting social inclusion particularly of women. The pursuit of the social inclusion objective is intended to come from the provision of credit to those previously excluded from credit which enables them to establish a business (even if a one-person business). Robinson (2001) p. xxx) viewed microfinance in terms of “the large-scale provision of small loans and deposit services to low-income people by secure, conveniently located, competing commercial financial institutions [which] has generated the processes needed to democratize capital. ... Appropriately designed financial products and services enable many poor people to expand and diversify their economic activities, increase their incomes, and improve their self-confidence. Financial institutions knowledgeable about microfinance can become profitable and self-sustaining while achieving wide client outreach” (Robinson 2001, p. xxx). As Lagoa and Suleman (2014 , pp. 45-6) indicate, microfinance institutions have been something of a niche of the financial system, and that there is a diversity of institutions which serve as microfinance institutions. Microfinance institutions “have a leading role in terms of loans disbursed, in reaching to non-bankable clients and specific vulnerable groups, in the offer of other services, in large organisational dimension, and good recovery rate. Others have been more sceptical of microcredit arguing that the original concept of the provision of credit “to establish or expand incomegenerating projects—was transmuting into the much wider concept of microfinance, meaning the supply of a whole range of financial services to the poor, including microcredit, micro-insurance, micro-savings, and so on” (Bateman and Chang 2014).
Many would argue that MFIs suffered from ‘mission creep’ and became more focused on profit than on poverty relief. Microfinance institutions have suffered from financialisation in being sucked into operating as profit-seeking financial institutions, and from the financing of consumer debt rather than the provision of investment. The ‘development model’ which lay behind microfinance could be seen as groups (whether because poor, on the grounds of gender, etc.) could not otherwise secure credit, and this acts as a constraint on their economic activities. The reasons why they could not otherwise secure credit would include transactions costs for small loans, discrimination, etc. Providing those groups with credit would then enable investment to be undertaken. But there is the need for support (education, management skills, infrastructure) and the need for demand for what they produce. Further, MFI represents the allocation of existing funds which detract from their use elsewhere: it may of course be socially preferred.