Abstract

http://ssrn.com/abstract=2039668
 
 

References (40)



 


 



What Drives A Long-Term Relationship In Microcredit? Insights from a Cambodian Microfinance Institution


Alberto Lanzavecchia


University of Padova, Italy

Luminita Enache


Tuck School of Business Dartmouth College; Victoria University of Wellington

March 2013

Working Paper No. 91 Centre for Accounting, Governance and Taxation Research School of Accounting and Commercial Law Victoria University of Wellington

Abstract:     
This article examines the determinants of the nominal value of loans in microcredit and the factors that drive long-term relationship banking. The dataset is drawn from primary data gathered from 216 randomly selected borrowers in a Cambodian microfinance institution. Analysis is performed using an OLS regression model.

The results confirm positive and significant impacts of real estate assets and loan purposes on the amount borrowed and a negative impact of being single as a civil status. Long-term relationships are positively affected by: age of borrower and purpose of loan; and negatively affected by female gender.

Contrary to general belief that microcredit is targeted to the “poorest of the poor”, a new market segment in microcredit was discovered within which MFI might target low-income/asset backed clients, granting loans on a “sustainable” basis, by applying the fundamental criteria of commercial banking: assessing credit worthiness and loss given default.

Number of Pages in PDF File: 19

Keywords: microcredit, collateral, loan size, Relationship banking, Cambodia

JEL Classification: G29, O16, I30


Open PDF in Browser Download This Paper

Date posted: April 14, 2012 ; Last revised: August 20, 2013

Suggested Citation

Lanzavecchia, Alberto and Enache, Luminita, What Drives A Long-Term Relationship In Microcredit? Insights from a Cambodian Microfinance Institution (March 2013). Working Paper No. 91 Centre for Accounting, Governance and Taxation Research School of Accounting and Commercial Law Victoria University of Wellington. Available at SSRN: http://ssrn.com/abstract=2039668 or http://dx.doi.org/10.2139/ssrn.2039668

Contact Information

Alberto Lanzavecchia
University of Padova, Italy ( email )
Via del Santo, 33
Padova, PD 35123
Italy
+39 049 8274060 (Phone)
+39 178 2208411 (Fax)
Luminita Enache (Contact Author)
Tuck School of Business Dartmouth College ( email )
Hanover, NH 03755
United States
6037297148 (Phone)
HOME PAGE: http://https://www.tuck.dartmouth.edu/faculty/faculty-directory/luminita-enache
Victoria University of Wellington ( email )
New Zealand
Feedback to SSRN


Paper statistics
Abstract Views: 646
Downloads: 89
Download Rank: 191,096
References:  40

© 2015 Social Science Electronic Publishing, Inc. All Rights Reserved.  FAQ   Terms of Use   Privacy Policy   Copyright   Contact Us
This page was processed by apollo5 in 1.218 seconds