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on Microfinance |
| By: | Lucia, Dalla Pellegrina; Angela, De Michele; Giorgio, Di Maio; Paolo, Landoni; Susanna, Parravicini; |
| Abstract: | A quasi-natural experiment has been carried out in which the Centre Meeting (CM) rules of some centres of a large Microfinance Institution (MFI) that offers microfinance services, in the form of group lending, were changed. The study has been carried out at the Small Enterprise Foundation (SEF), an MFI that operates in South Africa. The frequency of group meetings, organised as part of the “Monthly Centre Meetings†pilot programme, was reduced from bimonthly to monthly, and only one member per credit-group was asked to participate instead of all the group members. The purpose of these changes was to allow borrowers to save time to spend on their own economic activities. This new policy was put into force for one year, from May 2014 to the end of April 2015. After selecting a suitable control group of micro-borrowers, using Propensity Score Matching techniques, we ran difference-in-difference (DID) regressions to evaluate the impact of the policy changes on the client’s repayment and saving behaviour. The obtained estimates suggest that the change in the policy rules had led to a deterioration of the customers’ saving balances and had increased delayed repayments. Text mining techniques, applied to survey data, pointed towards a lack of trust within the groups, the members of which did not meet frequently outside the CMs, and this was found to be one of the main causes of failure of the pilot experiment. We have concluded that group meetings are an effective tool to stimulate the accumulation of social capital for some categories of clients, and that those MFIs that wish to implement similar interventions should be aware of the drawbacks pertaining to borrowers’ behaviour. |
| Keywords: | Microfinance, Group lending, Group meetings, Quasi-natural experiment, Repayment delay, Savings |
| JEL: | G21 O15 L31 I25 |
| Date: | 2017–11–30 |
| URL: | http://d.repec.org/n?u=RePEc:mib:wpaper:374&r=mfd |
| By: | Catia Batista; Pedro Vicente |
| Abstract: | Investment in improved agricultural inputs is infrequent for smallholder farmers in Africa. One barrier may be limited access to formal savings. We designed and conducted a field experiment in rural Mozambique that randomized access to a savings account through mobile money to a sample of smallholder farmers. All subjects were given access to mobile money and information about fertilizer use. We also randomized whether closest farming friends were targeted by the same intervention. We find that the savings account increased savings, the probability of fertilizer use, by 31-36 pp, and the use of other agricultural inputs. We also show that the savings account increased household expenditures, in particular non-frequent ones. Our results suggest that the network intervention decreased social pressure to share resources and that the savings account protected farmers against this network pressure. JEL codes: D14, D85, Q12, Q14 |
| Keywords: | Mobile money, savings, agriculture, smallholder farmers, social networks, field experiment, Mozambique, Africa. Length: 41 pages |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:unl:novafr:wp1705&r=mfd |
| By: | Asongu, Simplice A.; Odhiambo, Nicholas M. |
| Abstract: | The transition from Millennium Development Goals to Sustainable Development Goals has substantially shifted the policy debate from development to inclusive development. Using interactive quantile regressions, we examine the correlations between mobile banking and inclusive development (quality of growth, inequality and poverty) among individuals in 93 developing countries for the year 2011. Mobile banking entails: ???mobile used to pay bills??? and ???mobile used to receive/send money???. The findings broadly show that increasing mobile banking dynamics to certain thresholds would increase (decrease) quality of growth (inequality) in quantiles at the high-end of inclusive development distributions for the most part. The study is original in that it explores the relationship between mobile banking and inclusive development using three measurements of inclusive development, namely: quality of growth, inequality and poverty. As a main policy implication, encouraging mobile banking applications would play a substantial role in responding to the challenges of immiserizing growth, inequality and poverty in developing countries |
| Keywords: | Mobile banking; Quality of growth; Poverty; Inequality; Developing countries |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:uza:wpaper:23396&r=mfd |
| By: | Pascal Glémain |
| Abstract: | Direct heir of the Italian Mount of piety, the “Credit Municipal” or French pawnshop model was born in Nantes in 1813, a metropole which are located in the west part of France. At this period of time, it was public organization of credit with a social mission: to help people who are in financial difficulty (excluded from access to banking currency). In 1955, the “Credit Municipal” became establishment of Public Welfare, with legal personality and financial autonomy under the governance of the City of Nantes. Credit Institution like “cooperative banks” but with a general purpose since 1984, the “Credit Municipal” is located today in the social and solidarity economy (SSE). With this research paper, we want to demonstrate the historical place of the French pawnshops in the microcredit devises landscape. Indeed, since “social banking” is not yet used as a category in official French banking system, we lack an authoritative definition because, we seem to be without social banking model through the French banking system history. But, we try to show that it’s not the case. Indeed, French pawnshops, from Middle-Age to nowadays, have always experimented “social banking devises” in order to straight against usury practices and banking exclusion. Since the beginning of the 19th Century, the pawnshops have been an important element of the French model of social microcredit both through their traditional “pawn loans” system and through their “stability loan” devise. |
| Keywords: | France; Pawnshop; social banking; social microcredit; pawn loans; stability loan devise; beneficiary; social movements; capitalism; solidarism; social enterprise; banking exclusion |
| JEL: | G21 |
| Date: | 2017–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:sol:wpaper:2013/261717&r=mfd |