Do Microloan Officers Want to Lend to the Less Advantaged? Evidence from a Choice Experiment

41 Pages Posted: 2 Mar 2011

See all articles by Moïse Sagamba

Moïse Sagamba

University of Bujumbura

Oleg Shchetinin

University of Gothenburg

Nurmukhammad Yusupov

Audencia Nantes School of Management

Date Written: February 25, 2011

Abstract

The mission of microfinance is generally perceived as compensation for the failure of the mainstream financial institutions to deliver access to finance to the poor. Microloan officers have significant influence on microloans allocation as they contact loan applicants and process information inside microfinance institutions (MFIs). We conduct a choice experiment with microloan officers in Burundi to determine which clients are preferred for microloan allocation and whether the less advantaged are indeed targeted. The results suggest that the allocation of microloans is slightly in favor of the less advantaged, whereas the main determinant is the quality of the applicants' business projects. Somewhat surprisingly, we find only small differences in the determinants of the targeted groups between non-profit and profit-seeking MFIs.

Keywords: microfinance, choice experiment, microloan officers, non-profit organizations

JEL Classification: C83, C93, G21, L31, O55

Suggested Citation

Sagamba, Moïse and Shchetinin, Oleg and Yusupov, Nurmukhammad A., Do Microloan Officers Want to Lend to the Less Advantaged? Evidence from a Choice Experiment (February 25, 2011). Available at SSRN: https://ssrn.com/abstract=1771665 or http://dx.doi.org/10.2139/ssrn.1771665

Moïse Sagamba

University of Bujumbura ( email )

Kigamba Avenue, 16, Kinindo
Bujumbura
Burundi

Oleg Shchetinin (Contact Author)

University of Gothenburg ( email )

Box 640
Vasagatan 1, E-building, floor 5 & 6
Göteborg, 40530
Sweden

Nurmukhammad A. Yusupov

Audencia Nantes School of Management ( email )

8 route de la Jonelière, BP 31222
Nantes Cedex 3, Cedex 3 44312
France

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