Cull, RobertDemirguc-Kunt, AsliMorduch, Jonathan2012-03-302012-03-302011World Development0305750Xhttps://hdl.handle.net/10986/5555Regulation allows microfinance institutions to take deposits and expand their banking functions, but complying with regulation can be costly. We examine implications for institutions' profitability and their outreach to small-scale borrowers and women, using a newly-constructed dataset on 245 leading institutions. Controlling for the non-random assignment of supervision via treatment effects and instrumental variables regressions, we find evidence consistent with the hypothesis that profit-oriented microfinance institutions respond to supervision by maintaining profit rates but curtailing outreach to women and customers that are costly to reach. Institutions with a weaker commercial focus instead tend to reduce profitability but maintain outreach.ENBanksOther Depository InstitutionsMicro Finance InstitutionsMortgages G210Financial Institutions and Services: Government Policy and Regulation G280Economics of GenderNon-labor Discrimination J160Economics of Regulation L510Economic Development: Financial MarketsSaving and Capital InvestmentCorporate Finance and Governance O160Journal ArticleWorld Bank