Microfinance and Moneylenders: Long-Run Effects of MFIs on Informal Credit Market in Bangladesh

Using two surveys from Bangladesh, this paper provides evidence on the effects of microfinance competition on village moneylender interest rates and households' dependence on informal credit. The views among practitioners diverge sharply: proponents claim that competition of microfinance instit...

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Bibliographic Details
Main Authors:	Berg, Claudia, Emran, M. Shahe, Shilpi, Forhad
Language:	en_US
Published:	World Bank, Washington, D.C. 2013
Subjects:	Access to Finance Access to markets accounting adverse selection affiliates aggregate demand Agriculture amount of loans Asset Purchase bank branch bank loans base year benchmark biases BIDS borrower branch location branch office checks client base collateral Competitive Markets consumer price index Credit Agencies credit cooperatives Credit Market credit markets credit programs Credit Rationing Credit System credit transactions debt debt accumulation Default Risk demand for credit developing countries Development Economics development policy disbursement donor funding econometric analysis econometrics economic activities economic conditions Economic Development Economic Statistics economics economies of scale educated women education level employment entrepreneurial ability exclusion Expenditure extreme poverty Federal Reserve Financial Institutions Financial Markets financial sector reform financial sustainability fixed costs fixed effect model formal bank formal banks formal financial sector government banks government credit government interventions government policy green revolution high interest rate high interest rates household fixed effect household fixed effects Household Income households human capital Human Resources IDS income variability indebtedness inefficiency Informal Borrowing Informal Credit informal financiers informal lenders informal loan informal loans instrument interest rate interest rate data interest rates International Bank investment projects Labor Market land ownership land-poor households landholders landless household landless households loan loan amount loan amounts loan demand loan officer loan officers loan product loan size loan sizes loans from friends market segmentation MARKET SHARE market shares maturity Merchant MFI MFIs Micro Finance micro-credit Microcredit microenterprises Microfinance microfinance institution microfinance institutions money lender moneylender Moneylenders moral hazard outstanding loans pool of borrowers positive effects poverty alleviation productivity public banks public safety net Public Subsidies regional dummy Regulatory Authority repayment repayment capacity repayment rate repayment rates repayment schedule repayment schedules return returns risk aversion risk premium Risk Taking rural banks rural credit rural credit market rural credit markets Rural Financial Markets safety net settlement short-term consumption loans sizes of loans source of income Sustainable Finance transactions costs undue influence usury usury laws village villages Vulnerable Group withdrawal
Online Access:	http://hdl.handle.net/10986/16317

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http://hdl.handle.net/10986/16317

Microfinance and Moneylenders: Long-Run Effects of MFIs on Informal Credit Market in Bangladesh

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