Examining the efficiency of community-based financial organizations on socio - economic development: The case of rural areas of Babol

This study focuses on community-based financial organization and examines their efficiency on socio-economic development of rural areas. The sample of analysis includes 30 members of the financial institutions in the rural areas of Babol. The research data were collected through the methods of in-depth interviews and participant observations. Then, the data were analyzed using qualitative content analysis. This analysis categorizes the effects of financial institutions into two major aspects. First, social aspects that refer to human capital (education, skill, health), social capital (participation, support, trust, solidarity, awareness), cultural capital (knowing people and places, keeping local traditions, protecting environment and cultural buildings), institutional capital (marketing, social security, enhancing rural council, publicizing local officials and their activities). Second, economic aspects that refer to financial capital (credit, insurance, saving) and economic capital (multiple sources of income, reducing economic expenditures, material resources). The key research findings indicate that the financial institutions have significant effects on both social and economic aspects as detailed above.