| Abstract: |
We study the provision of financial services to small firms, consumers, and
workers in developing countries as part of value chain relationships: value
chain microfinance (VCMF). We first explore how VCMF can both overcome
barriers to financial access – including asymmetric information, enforcement,
and behavioral biases – and strengthen value chains, but also how it can
introduce new challenges. We then review a recent empirical literature at the
intersection of value chains and microfinance studying the demand for and
effects of VCMF in credit, insurance, and savings markets. We conclude by
highlighting promising directions for future work. |