Essays on microfinance repayment behaviour : an evaluation in developing countries

Microfinance research concerns addressed in this thesis relate to: the associations between the individual characteristics of borrowers and the probabilities of being in delinquent or default; the determinants for the financial awareness of interest repayment; and the application and comparison of m...

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Main Author: Huang, Guan
Published: University of Reading 2018
Online Access:https://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.758158
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spelling ndltd-bl.uk-oai-ethos.bl.uk-7581582019-02-05T03:28:14ZEssays on microfinance repayment behaviour : an evaluation in developing countriesHuang, Guan2018Microfinance research concerns addressed in this thesis relate to: the associations between the individual characteristics of borrowers and the probabilities of being in delinquent or default; the determinants for the financial awareness of interest repayment; and the application and comparison of modern missing data techniques (Multiple Imputation, Maximum Likelihood Estimation, and Predictive Mean Matching) with incomplete loan book data. The thesis emphasises credit scoring issues that affect repayment performance and revolves around three empirical chapters that seek to address the above research concerns. Survey and loan book data from individuals in 51 MFIs across 27 developing countries. The data were compiled by the MFIs and collected by Micro Finanza Rating. Varied micro-econometric techniques (ordinary least squares, Logit regression, Tobit regression, Two-Part model, Double-Hurdle model, Box-Cox transformation, and three missing data imputation methods: Multiple Imputation, Maximum Likelihood Estimation, and Predictive Mean Matching) are used depending on the hypotheses being considered in each chapter. The main findings are: engaging in agriculture is related to a lower probability of default that measured by the amount of arrear in general; besides, the association between agriculture and the length of delayed repayment is insignificant; previous access to micro-finance has positive association with the financial awareness of the clients who lived in urban areas; in addition, previous access to saving service has positive effect on the clients with at least primary education; when the missing microfinance data is semi-continuous, PMM outperforms MI and ML in most simulations; for binary or ordinal categorical data, PMM performance surpass MI and ML only when the sample sizes of data are large, the missing rates are low, and the missing mechanism is MAR. The thesis suggests the following recommendation both for management of MFIs and government, we need to: make financial services for poor farm households and farm-related business more attractive to the MFIs; financial awareness can be improved by access to microfinance services, hence extra learning programmes may be unnecessary; Two-Part Model should be applied to credit scoring; and PMM imputation is the best technique to be applied to deal with the missing data issues and improve data quality in microfinance.University of Readinghttps://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.758158http://centaur.reading.ac.uk/80633/Electronic Thesis or Dissertation
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description Microfinance research concerns addressed in this thesis relate to: the associations between the individual characteristics of borrowers and the probabilities of being in delinquent or default; the determinants for the financial awareness of interest repayment; and the application and comparison of modern missing data techniques (Multiple Imputation, Maximum Likelihood Estimation, and Predictive Mean Matching) with incomplete loan book data. The thesis emphasises credit scoring issues that affect repayment performance and revolves around three empirical chapters that seek to address the above research concerns. Survey and loan book data from individuals in 51 MFIs across 27 developing countries. The data were compiled by the MFIs and collected by Micro Finanza Rating. Varied micro-econometric techniques (ordinary least squares, Logit regression, Tobit regression, Two-Part model, Double-Hurdle model, Box-Cox transformation, and three missing data imputation methods: Multiple Imputation, Maximum Likelihood Estimation, and Predictive Mean Matching) are used depending on the hypotheses being considered in each chapter. The main findings are: engaging in agriculture is related to a lower probability of default that measured by the amount of arrear in general; besides, the association between agriculture and the length of delayed repayment is insignificant; previous access to micro-finance has positive association with the financial awareness of the clients who lived in urban areas; in addition, previous access to saving service has positive effect on the clients with at least primary education; when the missing microfinance data is semi-continuous, PMM outperforms MI and ML in most simulations; for binary or ordinal categorical data, PMM performance surpass MI and ML only when the sample sizes of data are large, the missing rates are low, and the missing mechanism is MAR. The thesis suggests the following recommendation both for management of MFIs and government, we need to: make financial services for poor farm households and farm-related business more attractive to the MFIs; financial awareness can be improved by access to microfinance services, hence extra learning programmes may be unnecessary; Two-Part Model should be applied to credit scoring; and PMM imputation is the best technique to be applied to deal with the missing data issues and improve data quality in microfinance.
author Huang, Guan
spellingShingle Huang, Guan
Essays on microfinance repayment behaviour : an evaluation in developing countries
author_facet Huang, Guan
author_sort Huang, Guan
title Essays on microfinance repayment behaviour : an evaluation in developing countries
title_short Essays on microfinance repayment behaviour : an evaluation in developing countries
title_full Essays on microfinance repayment behaviour : an evaluation in developing countries
title_fullStr Essays on microfinance repayment behaviour : an evaluation in developing countries
title_full_unstemmed Essays on microfinance repayment behaviour : an evaluation in developing countries
title_sort essays on microfinance repayment behaviour : an evaluation in developing countries
publisher University of Reading
publishDate 2018
url https://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.758158
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