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on Microfinance |
| By: | Sumit Agarwal; Thomas Kigabo; Camelia Minoiu; Andrea F. Presbitero; André F. Silva |
| Abstract: | A large-scale microcredit expansion program---together with a credit bureau accessible to all lenders---can enable unbanked borrowers to build a credit history, facilitating their transition to commercial banks. Loan-level data from Rwanda show the program improved access to credit and reduced poverty. A sizable share of first-time borrowers switched to commercial banks, which cream-skim less risky borrowers and grant them larger, cheaper, and longer-maturity loans. Switchers have lower default risk than non-switchers and are not riskier than other bank borrowers. Switchers also obtain better loan terms from banks compared with first-time bank borrowers without a credit history. |
| Keywords: | Access to credit; Microfinance; Unbanked; Credit bureau; Bank loans |
| JEL: | G21 O12 O55 |
| Date: | 2021–07–15 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfe:2021-41&r= |
| By: | Galang, Ivory Myka G. |
| Abstract: | Policymakers and donors have long viewed credit programs as salient means to develop the agriculture sector, especially the small-farm agriculture. Credit programs in the country have evolved from subsidized directed credit programs to a more market-based approach. There have been little to no studies that examine poor agricultural producers’ access to credit and how it affects agricultural performance, especially in the context of Agrarian Reform Beneficiary Organization (ARBO) members. This policy study utilized primary data from the Baseline Survey of Project ConVERGE, a project of the Department of Agrarian Reform, to analyze the borrowing incidence among ARBO member households, particularly those engaged in farm production. It appears from the results of the study that: membership in an ARBO is associated with better credit access; borrowing ARBO agricultural households are better off than nonborrowing ARBO agricultural households; and farmer associations/cooperatives are among the top sources of agricultural credit in the countryside aside from microfinance institutions; and Certificate of Land Ownership Award (CLOA)-holding ARBO agricultural households have higher borrowing incidence than the average ARBO agricultural households. Strengthening the capacity of credit retailers through trainings, especially in leadership and credit management, is needed to further improve their lending performance. <p> Comments to this paper are welcome within 60 days from date of posting. Email publications@mail.pids.gov.ph. |
| Keywords: | credit, poor, CLOA, collective CLOA, individual CLOA, loan, formal credit, informal credit, agricultural households, DAR |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:phd:dpaper:dp_2020-44&r= |
| By: | Samantha Horn (Department of Social and Decision Sciences, Carnegie Mellon University); Julian C. Jamison (Department of Economics, University of Exeter); Dean Karlan (Kellog School of Management, Northwestern University); Jonathan Zinman (Department of Economics, Dartmouth College) |
| Abstract: | Is financial knowledge change necessary for lasting behavior change? Or, akin to Friedman's billiard player, can behavior persist "as if" such knowledge is held? We randomize 240 Ugandan young-adult clubs to financial education, savings account access, both, or neither. Each education arm, but not the account-only arm, increases members' financial knowledge and trust at one-year. At five-years, knowledge effects essentially disappear and trust effects weaken. However, savings, wealth and income increase for each treatment at both one and five years, suggesting multiple viable paths to statistically indistinguishable average outcomes and that textbook knowledge change is unnecessary for lasting impacts. |
| Keywords: | financial education, financial literacy, financial access, savings |
| JEL: | D12 D91 O12 |
| Date: | 2021–07–30 |
| URL: | http://d.repec.org/n?u=RePEc:exe:wpaper:2102&r= |