FINANCIAL TERMS AND RATIOS

This section defines certain key financial terms used by financial institutions involved in microfinance. The definitions are provided in six main sections:

(1) those found on the Income Statement;

(2) those found on the Balance Sheet;

(3) those found on the Portfolio and Outreach; and

(4) those found on the Economic Indicators;

(5) rules used to calculate financial ratios;

(6) those found on Key Performance Indicators.

They are presented in the order in which they appear on the input form. For consistency and simplicity reasons, the term “MFI” is being used throughout this manual to address all kinds of financial institutions involved in the provision of microfinance services.