Does rating help microfinance institutions raise funds? Cross-country evidence

This paper studies whether microfinance rating agencies were able to impose market discipline on microfinance institutions (MFIs) during the period 1998-2002. The results indicate that not all rating agencies had the same impact. Rating by some rating agencies helped MFIs raise funds, while rating by other agencies did not. The evidence also suggests that subsidizing rating did not help MFIs raise more funds.