International Journal of Neutrosophic Science IJNS 2690-6805 2692-6148 10.54216/IJNS https://www.americaspg.com/journals/show/4171 2020 2020 Tashkent State University of Economics, Tashkent, Department of World Economy and International Economic Relations, Uzbekistan Muhammad Muhammad DSc, Professor, International Islamic Academy of Uzbekistan, Head of “Islamic Economics and Finance, Pilgrimage, Tourism” Department, Tashkent, Uzbekistan Olim Astanakulov College of Business Administration, American University of the Middle East, Kuwait Tonguc Cagin 4hD student, Research Center “Scientific Foundations and Problems of the Development of the Economy of Uzbekistan” at the Tashkent State University of Economics, Tashkent, Uzbekistan Akhmedova Ugilshod Musurmonkul This work analyzes the econometric efficiency in the use of finance instruments applied by microfinance institutions, using a Neutrosophic methodological framework; it develops with emphasis in terms of financial performance and social impact for 2018-2023. The study aims to fill important gaps in understanding how alternative financial instruments affect operational efficiency, poverty mitigation and institutional sustainability within a changing regulatory and development context. The mixed-methods was used by combining the N-MCDM and DEA technique with panel data regression analysis techniques. The sample consisted of 89 MFIs (including traditional and alternative-finance-based ones) in all 14 administrative regions. The method used for efficiency estimation was two-stage DEA, GMM was used to estimate the dynamic panel model, and Tobit regression model a set of key explanatory variables for performance. Input data were institutional annual financial reports, operation indicators, borrower information as well as macro-prudential regulatory metrics from central financial authorities. The outcomes indicate that microfinance institutions (MFIs) using alternative finance have higher social efficiency at 0.863 compared with their Conventional counterparts (at 0.741), while they conserve the same financial efficiency (0.694 versus 0.708). Murabaha-type financing models had a 26% better portfolio quality so that portfolio-at-risk percentages were as high as 2.6% compared to conventional frameworks of 3.5%. Musharaka-utilizing systems captured 21% higher likelihoods of loan recovery, whereas Ijarah-based models showed 18% lower odds of default. Moreover, rural outreach efficiency improved by 34% and women’s participation ratio became 81% instead of 64%, in conventional institutions. With marginally lower average ROA (1.97% compared to 2.24%), alternative-finance players revealed a higher level of alignment with priorities on value-creating expansion and impact on society. In conclusion, the results highlight the power of neutrosophic econometric analysis for assessing trade-offs among complex financial and social decisions, providing a strong decision-support system for policymakers and financial regulators aiming to design the optimal balance between profitability, efficiency and social welfare in microfinance schemes. 2026 2026 337 358 10.54216/IJNS.270129 https://www.americaspg.com/articleinfo/21/show/4171