Exploring factors influencing the microfinance program sustainability

Abstract Ensuring the sustainability of development interventions such as microfinance programs is essential for making sure that the financial access is available for the poor in long term. However, many project-based microfinance have faced sustainability issues. Therefore, exploring the factors affecting the sustainability of the programs is essential. Using institutionalist view of microfinance sustainability and considering project implementation aspects, this study aims to explore the factors that influence the sustainability of project-based microfinance institutions (MFIs). Quantitative approach by using a statistical tool is used to analyse the survey of the 85 microfinance bankers from 65 Microfinance institutions (MFIs). The result showed that project-based microfinance sustainability is influenced by local project characteristics, community support and project management. It implies that project implementation and its sustainability is concomitant. Project implementation that considers local community and is supported by project management could hold an important role in the sustainability of the project. Furthermore, developing sustainability strategies in planning and implementation stages is crucial. Hence, international development project actors should take them into account.