Analyzing concentration trends and market structure in Jordan's microfinance industry using the SCP approach
Year: 2026
Type: article
Abstract: The scope of our study is to investigate the concentration levels and analyze the market structure of Jordan’s microfinance sector. Utilizing the gross loan portfolio as a measurement of credit market share, this study constructs the Structure Conduct Performance SCP approach measured by the Herfindahl-Hirschman Index HHI technique, and the Concentration Ratios CRs. The results of the HHI reveal that the Jordanian microfinance sector was moderately concentrated, with average HHI values ranging from 18 to 19 percent from 2009 to 2015. However, it has recently transitioned to become highly concentrated, with the HHI reaching 25 percent in 2018. However, based on the CR, the largest two and four MFIs dominate the industry, accounting for more than 60 percent and 90 percent, respectively. Our findings will enhance the vision of the Jordanian microfinance industry structure and provide recommendations to policymakers and practitioners. JEL Classification: D4, L1, G2.
Source: Discover Sustainability
Authors: Mohammad W. Alomari, Nahil Saqfalhait
Institutions: Hashemite University, University of Jordan
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
Open Access status: gold
Estimated APC paid: $1,390
OpenAlex ID: W7136225399