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| Pagura, Maria E.; Graham, Douglas H.; Meyer, Richard L.. |
| Repeat borrowing is critical for the long-term financial viability of microfinance institutions (MFIs), which provide financial services to low-income households in developing countries. Repeat borrowers reduce MFI administrative costs, lower risks, and increase institutional productivity. In this paper we study the determinants of borrower dropout of an MFI operating in an urban center in Mali. Specifically, we quantify the explicit and implicit costs that a borrower must incur in obtaining loans from an MFI. |
| Tipo: Conference Paper or Presentation |
Palavras-chave: Financial Economics. |
| Ano: 2001 |
URL: http://purl.umn.edu/20568 |
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| Pagura, Maria E.. |
| In this study it is shown that group lending is not always effective in dealing with the information and enforcement issues associated with financial intermediation, In particular, by transferring all screening responsibilities onto borrowers, efficiency is lost in the intermediation process, creating poor quality matches between borrowers and loan contracts. This results in high client exit. This phenomenon is especially exaggerated in environments in which group lending based on joint liability is a new lending technology in the financial market. Drawing upon theories of job matching and technology adoption, client exit is described in a choice theoretic framework. Basically, when faced with a decision of staying or exiting, a client compares her... |
| Tipo: Conference Paper or Presentation |
Palavras-chave: Financial Economics. |
| Ano: 2002 |
URL: http://purl.umn.edu/19698 |
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