The liberal American financial system is one of the major beneficiaries of the globalization forces. Taking a cue from the fast development of the American economy, other nations have liberalized their financial systems that were under the tight wraps of the state. In countries like India that saw the reign of the license raj, major changes have taken place. However, very recently and especially after the economic woes started taking its toll, there is a better understanding between the various financial institutions. It has become inevitable due to the unexpected changes in the financial market.

The twenty first century is going to be totally different. With each passing year, the financing institutions will have to face more competition. Newer financing institutions like LoanMax started by the renowned banker rod aycox are now household names in the areas where they have operations. By improving their productivity and efficiency, this firm could gain the support of the common people. Also, it is the only option for surviving the competitive environment.

Even the social fabric of the United States has undergone a sea change. Small firms like LoanMax had to adjust to the emerging situations from time to time. Due to the economic slowdown customer spending has come down and very few people are interested in investing in real estate. Thus in such an environment, to post profits is rather difficult. Especially during an economic slowdown, attempting to improve the overall efficiency requires much effort.

Only through continuous analysis will it be possible to understand the overall performance. Very often performance is judged using the profitability parameter. However, few studies have considered the fund allocation efficiency and loan retrieval aspects as well. Even then, the overall efficiency of a lending institution like LoanMax can be measured by using simple rational analysis and its comparison with known benchmarks. Thus the overall efficiency is a function of:
a) Technical efficiency, i.e., those aspects producing higher output per unit of given input and
b) Allocation efficiency, i.e., by getting the mix of outputs right, given their relative prices