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on Microfinance |
| By: | Nguyen, Luan-Thanh |
| Abstract: | The use of mobile technology services in Vietnam has surged, offering convenience and enhancing various aspects of users' lives. This shift towards wireless connectivity has also affected financial transactions and remittances, aligning with goals of a cashless society and financial inclusion. Mobile money, a widely used mobile service, is examined in this study. We focus on the determinants affecting the adoption of mobile money services, which are of interest to mobile money firms, telecom companies, banks, and developers. Factors like price, social influence, and perceived risk are explored as they influence consumer acceptance. To succeed, service providers must lower costs, emphasize benefits, and ensure seamless functionality. User-friendliness, trust, and data security are essential for sustained adoption and financial inclusion. This study provides insights into mobile money adoption in Vietnam, guiding stakeholders in the mobile technology sector to adapt and thrive in this evolving landscape. |
| Keywords: | Mobile money, PLS-SEM, Vietnam, UTAUT |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:esconf:278113&r=mfd |
| By: | Burlando, Alfredo (University of Oregon); Kuhnk, Michael A. (University of Oregon); Prina, Silvia (Northeastern University) |
| Abstract: | Digital loans are a source of fast, short-term credit for millions of people. While digital credit broadens market access and reduces frictions, default rates are high. We study the role of the speed of delivery of digital loans on repayment. Our study uses unique administrative data from a digital lender in Mexico and a regression-discontinuity design. We show that reducing loan speed by doubling the delivery time from ten to twenty hours decreases the likelihood of default by 21%. Our findings suggest that selectively slowing down credit could improve lender profitability and help consumers avoid default. |
| Keywords: | digital credit, waiting periods, defaults, financial access |
| JEL: | D14 D18 G51 O16 |
| Date: | 2023–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16451&r=mfd |
| By: | Sihan Fang (Nanyang Technological University, 50 Nanyang Avenue, 639798 Singapore); Hyeokkoo Eric Kwon (Nanyang Technological University, 50 Nanyang Avenue, 639798 Singapore); Tian Lu (Arizona State University, 400 E Lemon St, Tempe, AZ, 85281 US); Yingjie Zhang (Peking University, No.5 Yiheyuan Road, Haidian, Beijing, 100871 China) |
| Abstract: | We have witnessed the convenience of mobile channels and how they boost user engagement in multiple industries. Such positive effects might or might not stay with users’ financial behavior since it requires a significant cognitive effort and risk preferences could also alter the effect direction. Moreover, regarding their effects on two-sided platforms, prior studies have focused on the decision-making of one single side. This might bias our understanding of mobile channels, especially in the finance sector, where lenders’ behavior would be influenced by borrowers’ application quality and quantity. To bridge these gaps, we investigate how mobile channels shape the behaviors of both borrowers and lenders in peer-to-peer (P2P) lending platforms, as well as the corresponding impacts on credit risk management and economic return. Drawing upon the cognitive load theory, we postulate that borrowers and lenders under heavy and mild cognitive load would exhibit distinct behaviors when submitting loan applications or approving loan requests, respectively. Empirically, we collaborate with a leading P2P lending platform to launch two-sided field experiments, in which we randomly assign mobile treatments to borrowers and lenders. The results illustrate that mobile borrowers are more likely to terminate loan submissions, especially during peak commuting hours. By contrast, mobile lenders have a higher tendency to approve loan applications within a shorter period. Surprisingly, we observe no change in the quality of submitted or approved loans. Considering the improved debt collection capability of the platform, we reveal that mobile adoption brings profit enhancement. We offer multiple theoretical and managerial implications. |
| Keywords: | Mobile adoption; Cognitive load theory; Peer-to-peer lending; Two-sided behavior; Field experiment |
| JEL: | G41 M31 O17 O33 |
| Date: | 2023–09 |
| URL: | http://d.repec.org/n?u=RePEc:net:wpaper:2301&r=mfd |
| By: | Amoako, Frimpong; Asuamah Yeboah, Samuel |
| Abstract: | The study investigates the critical role of community representation within Rural Cooperative Banks (RCBs) and its influence on key decision-making processes, specifically, pertaining to financial policies, lending practices, and resource allocation. As RCBs play a pivotal role in providing financial services to local communities, understanding the dynamics of community representation within these institutions is essential. Through a comprehensive examination of the interactions between community voices and RCB operations, this research sheds light on whether and how local perspectives shape the accessibility of financial services for rural populations. By exploring the intricate relationship between representation and decision-making, this study contributes valuable insights to enhance the effectiveness of RCBs in serving their communities and promoting financial inclusivity. |
| Keywords: | Community representation, Rural Cooperative Banks (RCBs), Decision-making processes, Financial policies, Lending practices, Resource allocation, Financial services, Rural communities, Access to finance, Financial inclusivity |
| JEL: | G21 G28 O16 P25 R12 |
| Date: | 2023–05–07 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:118634&r=mfd |
| By: | Frisancho, Verónica |
| Abstract: | This paper studies whether school-based financial education has spillover effects from children to parents. Leveraging data from a large-scale experiment with public high schools in Peru and credit bureau records on the parents of the youth targeted, this study measures the impact of providing personal finance lessons during secondary school on parental financial behavior. Financial education lessons in the school yield limited average spillover effects, but lead to sizable effects on parental financial behavior within disadvantaged households. Among parents from poorer households, the treatment reduces default probability by 26%, increases credit scores by 5%, and increases current debt levels by 40%. The treatment has stronger effects among the parents of daughters, who experience a significant 6.7% increase in their credit score and a 28% reduction in their loan portfolio in arrears. Among the parents of boys, most of the spillover effects are muted. |
| Keywords: | : Financial Education;youth;spillovers;Financial literacy;Credit records;Treatment effects;Long-lasting impacts |
| JEL: | C93 D14 G53 O16 |
| Date: | 2023–02 |
| URL: | http://d.repec.org/n?u=RePEc:idb:brikps:12696&r=mfd |
| By: | Gandelman, Néstor; Lluberas, Rodrigo; Misail, Daniel; IDB Invest |
| Abstract: | Uruguay implemented an ambitious financial inclusion program that included a fiscal stimulus through VAT rebates and subsidies for point of sale (POS) adoption. One of its main provisions banned cash payment of wages and social benefits and forced financial institutions to open wage-accounts with extremely beneficial conditions. In the aggregate, the number of debit cards transactions increased sharply. We test the wage-banking channel of the financial program exploiting differences in the treatment intensity between public sector and private sector workers. We find that while the provision of bank accounts increased the number of debit cards, it had modest effects on the probability of payment with cards that are mostly produced by a more intensive use of debit cards by those who already had them before the Financial Inclusion Act went into effect. Thus, the aggregate effects must be produced by the fiscal channel of the financial inclusion program. Finally, we fail to find effects on either access to short-term credit or expenditure or savings. |
| JEL: | D12 G21 G50 |
| Date: | 2023–03 |
| URL: | http://d.repec.org/n?u=RePEc:idb:brikps:12769&r=mfd |
| By: | Cerda, Maikol; Gertler, Paul; Higgins, Sean; Montoya, Ana María; Parrado, Eric; Undurraga, Raimundo |
| Abstract: | We conducted two randomized controlled trials (RCTs) to evaluate the impact of government-guaranteed loans offered by the Chilean and Colombian governments. The public funds of these programs greatly expanded following the start of the Covid-19 pandemic and offered loans to Micro, Small and Medium Enterprises to mitigate the negative impact of the shock. Through a collaboration with private banks, we launched two experiments which offered loans to a sub-set of the 10, 072 Chilean and 3, 079 Colombian small businesses that took part in our experiments. Most of these firms had previously applied for a loan during the pandemic--but prior to the RCTs--but were rejected by banks due to their risk analysis of the firms. With take-up rates of 27% and 29%, respectively, we find that Covid-19 loans had a significant positive impact on the total liquidity that treated MSMEs could access: total liquidity with the formal banking system increased by 15.7% (statistically significant at the 1% level). The results of our RCTs will inform Latin American governments concerning their strategies to support MSMEs via government-backed loan programs and will shape similar public policies in the future. |
| Keywords: | RCT;Government-guaranteed loans;COVID-19 pandemic;Eventstudy;Impact Evaluation |
| JEL: | J16 L26 P52 |
| Date: | 2023–02 |
| URL: | http://d.repec.org/n?u=RePEc:idb:brikps:12710&r=mfd |
| By: | Tanu Goyal (Indian Council for Research on International Economic Relations (ICRIER)); Radhicka Kapoor (Indian Council for Research on International Economic Relations (ICRIER)) |
| Abstract: | The results of the survey suggest that MSMEs have witnessed significant gains by integrating with e-commerce platforms. Improved market access is the most widely reported benefit of integration. Therefore, it is unsurprising that a majority of integrated enterprises report their willingness to increase the share of e-commerce sales in their total sales in the future. It is important to highlight the fact that at present, the volume of sales made through e-commerce platforms account for a relatively smaller share of the firms’ total sales compared to those made through traditional routes. And therefore, there is significant scope for MSMEs to increase share of online sales in total sales. The survey also examines the use of digital payments among MSMEs and how integrating with e-commerce platforms impacts their ability to access finance. A majority of the surveyed MSMEs report using digital wallets and mobile payments as the most frequently used payment mode for doing business. On average, cash-based sales are found to be higher for non-integrated MSMEs compared to integrated firms. Further, the use of bank loans is found to be marginally higher among integrated firms compared to non-integrated firms. |
| Keywords: | MSMEs, E-Commerce, Digital Wallets, icrier |
| Date: | 2023–09 |
| URL: | http://d.repec.org/n?u=RePEc:bdc:report:23-r-06&r=mfd |