Publication Type
Journal Article
Version
publishedVersion
Publication Date
9-2014
Abstract
We examine how increased competition among motivated microfinance institutions (MFIs) impacts the poorest borrowers’ access to microfinance. We find that competition depends on inequality, technology, and the possibility of double-dipping (borrowing from several sources). Without competition, even a motivated MFI may lend to the not-so-poor in preference to poor borrowers. If double-dipping is feasible, competition may encourage lending to the poor. The presence of double-dipping is critical for MFI competition to have a positive effect. When double-dipping is feasible, MFI coordination may worsen borrower targeting whenever inequality is intermediate. We discuss policy implications dealing with double-dipping, MFI coordination, and competition.
Keywords
Microfinance competition, Motivated MFIs, Inequality, Borrower targeting, Double-dipping, Coordination
Discipline
Finance
Research Areas
Applied Microeconomics
Publication
Developing Economies
Volume
52
Issue
3
First Page
211
Last Page
240
ISSN
0012-1533
Identifier
10.1111/deve.12047
Publisher
Wiley
Citation
Guha, Brishti and ROY CHOWDHURY, Prabal.
Borrower targeting under microfinance: Competition with motivated microfinance institutions and strategic complementarity. (2014). Developing Economies. 52, (3), 211-240.
Available at: https://ink.library.smu.edu.sg/soe_research/2257
Copyright Owner and License
Publisher
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.
Additional URL
https://doi.org/10.1111/deve.12047