This study shows how social capital affects the outreach and operational self-sufficiency of microfinance institutions (MFIs) around the world. Defining social capital as social networks, social norms, and trustworthiness, this research merges quantitative data from the Microfinance Information Exchange and World Values Survey to empirically test a which aspects of social capital have the greatest influence on MFI performance in the presence of an endogenous peer effect between MFIs. Regression results show that aspects of social capital have a direct influence on MFI performance, suggesting a tradeoff between outreach and sustainability, and display a strong endogenous peer effect.