nep-mfd New Economics Papers
on Microfinance
Issue of 2023‒03‒20
eight papers chosen by
Rachita Gulati
IIT Roorkee

  1. Information technology, inequality and adult literacy in developing countries By Simplice A. Asongu; Nicholas M. Odhiambo; Mushfiqur Rahman
  2. Who Pays for Sustainability? An Analysis of Sustainability-Linked Bonds By Julian F Kölbel; Adrien-Paul Lambillon
  3. Financial Inclusion Expectation Gap By Ozili, Peterson K
  4. Study on the Integration of Mobile Applications Into Governance Frameworks: A Study By Preminger, Ambrose
  5. Firm Size and Financing Behavior during the COVID-19 Pandemic: Evidence from SMEs in Istanbul By Aysan, Ahmet Faruk; Babacan, Mehmet; Gür, Nurullah; Süleyman, Selim
  6. Reassessing Women’s Participation in Entrepreneurial Activities in the Nineteenth Century: A Review of the Literature By Sonia Baijot; Charlotte Le Chapelain
  7. Who loses in financial inclusion? By Ozili, Peterson K
  8. Determinants of interest in eNaira and financial inclusion information in Nigeria: role of Fintech, cryptocurrency and central bank digital currency By Ozili, Peterson K

  1. By: Simplice A. Asongu (Yaounde, Cameroon); Nicholas M. Odhiambo (Pretoria, South Africa); Mushfiqur Rahman (University of Wales, UK)
    Abstract: The study assesses linkages between information technology, inequality and adult literacy in 57 developing countries for the period 2012-2016. Income inequality is measured with the Gini coefficient while six dynamics of information technology are taken on board, namely: use of virtual social network, internet access in schools, internet penetration, mobile phone penetration, fixed broadband subscription and number of personal computer users. The findings show that only internet access in schools unconditionally promote adult literacy. The corresponding inequality threshold that should not be exceeded in order for internet access in schools to continue promoting adult literacy is 0.739 of the Gini coefficient. Policy implications are discussed.
    Keywords: information technology, inequality; adult literacy
    JEL: D10 D14 D31 D60 O30
    Date: 2023–01
  2. By: Julian F Kölbel (University of St. Gallen - School of Finance; MIT Sloan; Swiss Finance Institute); Adrien-Paul Lambillon (University of Zurich - Department of Banking and Finance)
    Abstract: We examine the novel phenomenon of sustainability-linked bonds (SLBs). These bonds’ coupon is contingent on the issuer achieving a predetermined sustainability performance target. We estimate the yield differential between SLBs and non-sustainable counter-factuals by matching bonds from the same issuer. Our results suggest that issuing an SLB yields an average premium of -9 basis points on the yield at issue compared to a conventional bond, although this premium decreased over time. On average, the savings from this reduction in the cost of debt exceed the maximum potential penalty that issuers need to pay in case of failure of the sustainability performance target. This suggests that SLB issuers can benefit from a ’free lunch’, i.e. a financial benefit despite not reaching the target. Investigating the drivers of the premium, we show that there is no clear empirical relationship between the yield at issue and the coupon step-up agreement of SLBs. Instead, an issuer’s first SLB seems to command a significantly larger premium, suggesting that especially the first SLB is seen by investors as a credible signal of a company’s commitment to sustainability.
    Keywords: Sustainable investing, ESG, sustainability-linked bonds, impact, greenwashing
    Date: 2023–02
  3. By: Ozili, Peterson K
    Abstract: The objective of this article is to define the financial inclusion expectation gap, offer some insight into the nature and the causes of it, and suggest ways to reduce the gap. The discussion in the article provides helpful insights into this problem towards achieving the United Nations Sustainable Development Goals. It is hoped that such an attempt can provide insights to understand the expectation gap in financial inclusion.
    Keywords: Access to finance, banked adults, development, expectation gap, financial inclusion, financial institutions, formal financial services, unbanked adults.
    JEL: G20 G21
    Date: 2023
  4. By: Preminger, Ambrose
    Abstract: M-Governance has been viewed as a tool that would facilitate the process of empowering citizens, which is something that has been under discussion for decades in democratic countries that belong to the globalized world. It is viewed as a tool that will help facilitate such a process in a way that will be beneficial to the citizens themselves. It is deeply ingrained in the idea of democracy that citizens should be able to access government services online at any time of the day. This is because they should be empowered as a result of being able to do so. There are several pertinent issues that need to be addressed in this process, including the privacy of citizen data, the sharing of that data across countries, as well as the equal access to electronic services throughout the world, in order to make this process successful. In this study, we explore using a critical discourse analysis the perception of mobile governance as a catalyst for empowering citizens in the global advancement towards electronic democracy on the basis of a critical discourse analysis of mobile governance as a catalyst for empowering citizens in the global advancement towards electronic democracy. What role does mobile governance play in facilitating democracy in developing countries, where there are not enough resources to make it possible for every citizen to access mobile governance.
    Keywords: Society and technology, mobile apps, governance, m-government, e-government, mobile apps and governance, m-governance
    JEL: O32 O33 Q55
    Date: 2022–10–12
  5. By: Aysan, Ahmet Faruk; Babacan, Mehmet; Gür, Nurullah; Süleyman, Selim
    Abstract: This paper examines how small and medium-size enterprises (SMEs) in Istanbul managed their financial needs during the COVID-19 pandemic. A unique survey was conducted in May–June 2021 to analyze the effect of the pandemic on financial conditions and access to finance. The paper maps the differences between firms in terms of their financing conditions and behavior based on their size during the pandemic. The novel data set helps to conceptualize the impact of the COVID-19 pandemic on SMEs. The paper makes a contribution to the literature through using a large number of variables related to firms’ financial conditions and opportunities (e.g., credit restructuring, debt postponing, capital injection). The paper hypothesizes that SMEs are less likely than large firms to access formal finance opportunities, but they tend to rely more on informal financing. The empirical findings suggest that, during the pandemic, micro and small firms tend to borrow more from their acquaintances, such as relatives and friends. Micro firms are less likely to restructure their outstanding loans, borrow from banks, or inject capital. Furthermore, micro firms tend to cut their costs more to avoid further difficulty in their financial positions. Micro and small firms tend to apply for bank loans less than large firms, while medium-size firms are more likely to apply. Micro and small firms are more inclined to report difficulty in accessing credit.
    Keywords: COVID-19, emerging markets, finance, small and medium-size enterprises (SMEs)
    JEL: D22
    Date: 2023
  6. By: Sonia Baijot (UJML3 Droit - Université Jean Moulin Lyon 3 - Faculté de Droit - UJML - Université Jean Moulin - Lyon 3 - Université de Lyon); Charlotte Le Chapelain (UJML3 Droit - Université Jean Moulin Lyon 3 - Faculté de Droit - UJML - Université Jean Moulin - Lyon 3 - Université de Lyon, MSH-LSE - Maison des Sciences de l’Homme Lyon Saint-Etienne (MSH Lyon St-Etienne) - ENS Lyon - École normale supérieure - Lyon - UL2 - Université Lumière - Lyon 2 - IEP Lyon - Sciences Po Lyon - Institut d'études politiques de Lyon - Université de Lyon - UJML - Université Jean Moulin - Lyon 3 - Université de Lyon - UCBL - Université Claude Bernard Lyon 1 - Université de Lyon - UJM - Université Jean Monnet - Saint-Étienne - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Nineteenth-century businesswomen were almost entirely neglected, the historiography having adopted the hypothesis of the withdrawal of women from the business sphere after the eighteenth century. A growing body of literature is challenging this view, claiming that women did in fact actively contribute to the industrialization process and occupied key positions as investors and entrepreneurs, and revealing the constant and non-negligible presence of women at the head of businesses. This article reviews recent literature on women entrepreneurship in the nineteenth century. On the one hand, we analyze the reasons invoked by recent studies in order to explain why female entrepreneurship has so long remained ignored. The separate spheres ideology, the rise of industrialization, legal systems, the narrow definition of entrepreneurship and the issue of the sources might have contributed to maintain the idea that women would have withdrawn from business. On the other hand, we review the methods used in the recent revisionist literature in order to identify women entrepreneurs in the historical records and to assess the importance of their participation in entrepreneurial activities. Whereas some sources (tax rolls, censuses, directories, articles of association, etc.) help drawing general conclusions about female entrepreneurship supporting quantitative research, others (private family papers and objects, newspapers and advertisements, public and legal records) are particularly helpful for qualitative investigations permitting to draw in-depth portraits of these women.
    Abstract: Une littérature récente remet en question le présupposé, dominant dans l'historiographie, selon lequel les femmes se seraient retirées du monde des affaires au XIXe siècle. Elle montre en effet que l'entrepreneuriat féminin n'a pas disparu au XIXe siècle. Les femmes ont activement contribué au processus d'industrialisation, à des postes clés, en tant qu'investisseurs et en tant qu'entrepreneurs. Cette revue de littérature fait, d'une part, le bilan des facteurs d'invisibilisation des femmes dans l'historiographie traditionnelle, tel qu'invoqués par les récents travaux. L'idéologie des sphères distinctes, le développement du capitalisme industriel, les droits nationaux, la définition restrictive de l'entrepreneuriat ou encore le problème des sources sont invoqués comme ayant contribué à entretenir l'idée que les femmes se seraient retirées du monde des affaires au XIXe siècle. Par ailleurs, afin de délivrer des pistes de recherche et des outils pour de futurs travaux, cette revue de littérature présente les sources et les méthodes utilisées dans les récentes études. Alors que certaines sources (rôles d'imposition, recensements, annuaires, actes de sociétés, etc.) permettent de dresser des conclusions générales sur les femmes en affaires et viennent plutôt soutenir des recherches quantitatives, d'autres (documents et objets privés, articles de journaux et publicités, documents publics et légaux) sont plutôt appropriées aux recherches qualitatives et permettent de dresser un portrait approfondi de ces femmes.
    Keywords: Female entrepreneurship, nineteenth century, separate spheres ideology, sources, methods
    Date: 2022–09–01
  7. By: Ozili, Peterson K
    Abstract: Financial inclusion involves the provision of basic formal financial services to members of society. Policy efforts and collaboration with the private sector have helped to increase the level of financial inclusion in many countries. Such efforts give rise to net winners and net losers from financial inclusion efforts. This paper identifies the net losers from financial inclusion efforts. The lesson we learn from the net losers identified in this study is that being ‘banked’ is only a necessary condition to enjoy the benefits of financial inclusion. Being ‘banked’ is not a sufficient condition to enjoy the benefits of financial inclusion. We learn that a banked adult can be a net loser from financial inclusion despite being banked. This has wider implications for understanding the challenges to sustained financial inclusion.
    Keywords: financial inclusion, banked adults, losers, access to finance.
    JEL: G21 I31 I38
    Date: 2023–01–01
  8. By: Ozili, Peterson K
    Abstract: The eNaira is the central bank digital currency of Nigeria. People who are interested in the eNaira and financial inclusion will seek information about eNaira and financial inclusion. Their interest in information about eNaira and financial inclusion will make it easier for them to adopt the eNaira and embrace other financial inclusion innovations such as financial technology (Fintech) and cryptocurrency. This paper investigates the determinants of interest in eNaira and financial inclusion information. Interest over time data were analyzed using descriptive statistics, correlation analysis and ordinary least squares (OLS) regression. The study also used the GMM and 2SLS regression methods for robustness. The findings of this study reveal that interest in Fintech and eNaira information are significant positive determinants of interest in financial inclusion information. Also, interest in financial inclusion is a significant positive determinant of interest in eNaira information. Furthermore, interest in Fintech information has a positive and significant correlation with interest in financial inclusion information. There is also a significant positive correlation between interest in central bank digital currency information and interest in Fintech information. The implication of the findings is that interest in information about new financial innovations, such as Fintech and eNaira, can stimulate interest in information about financial inclusion.
    Keywords: eNaira, Fintech, financial inclusion, central bank digital currency, cryptocurrency, information, innovation, innovation diffusion theory.
    JEL: E50 E51 E52 E58 E59
    Date: 2023–01–04

This nep-mfd issue is ©2023 by Rachita Gulati. 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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