nep-mfd New Economics Papers
on Microfinance
Issue of 2016‒09‒25
three papers chosen by
Aastha Pudasainee and Olivier Dagnelie

  1. Labor market effects of improved access to credit among the poor: evidence from Cape Verde By Paolo Casini; Olivia Riera; Paulo Santos Monteiro
  2. Bridging the “Missing Middle” between Microfinance and Small and Medium-Sized Enterprise Finance in South Asia By Shankar, Savita
  3. Credit Surety Fund: A Credit Innovation for Micro, Small, and Medium-Sized Enterprises in the Philippines By Maningo, Gary V.

  1. By: Paolo Casini; Olivia Riera; Paulo Santos Monteiro
    Abstract: In the context of a collective household choice model, we show that the effects of improved credit access on search intensity by the unemployed are heterogeneous across households and dependent on the within-household bargaining power of the unemployed. We find empirical support for the predictions of our model using a household survey conducted by the authors in Cape Verde. These findings have important implications for the optimal design of microfinance programs, in particular concerning the targeting of loans and the use of microfinance as an instrument to support improved labor market outcomes.
    Keywords: Microfinance, Bargaining Power, Collective Household, Job Search
    JEL: D13 D14 J20 O11 O12
    Date: 2015
  2. By: Shankar, Savita (Asian Development Bank Institute)
    Abstract: With maturity in the microfinance market in South Asia, it is observed that some microfinance members’ needs grow beyond the boundaries of traditional microfinance group loans. In addition, there are other small enterprises whose needs are not met by microfinance institutions or commercial banks. It is important to address the financing needs of these firms given their employment potential, and hence this issue is on the policy agenda of the three countries studied in this paper: India, Bangladesh, and Pakistan. Drawing on interviews with chief executives of lending organizations and desk research, this paper reviews the options currently available to such firms in each country, the lending models being used, and recent policy initiatives to promote them. Based on the country experiences, the features of successful lending models for this segment and the specific challenges that need to be addressed are summarized and conclusions drawn.
    Keywords: microfinance in South Asia; lending models; microfinance group loans; missing middle
    JEL: L22 L25 O16
    Date: 2016–09–20
  3. By: Maningo, Gary V. (Asian Development Bank Institute)
    Abstract: Micro, small, and medium-sized enterprises are a backbone of the Philippine economy. One factor that hinders the growth of these enterprises is their difficulty in accessing finance from banks and other financial institutions. The Credit Surety Fund (CSF) was established to help these enterprises and other organizations become creditworthy and bankable. The CSF is a credit guarantee program initiated by the Bangko Sentral ng Pilipinas that enables enterprises and cooperatives to gain easier access to loans from banks without providing collateral. The CSF pools contributions from cooperatives and nongovernment organizations, local government units, institutions such as the Development Bank of the Philippines, the Land Bank of the Philippines, the Industrial Guarantee and Loan Fund, and other organizations. In this way, it is a public–private partnership that links the key players of the economy to empower enterprises and cooperatives.
    Keywords: credit Surety Fund; public–private partnerships; credit innovation; credit guarantee programs
    JEL: G21 G24 G32
    Date: 2016–09–22

This nep-mfd issue is ©2016 by Aastha Pudasainee and Olivier Dagnelie. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
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