Sowing the Seeds for Rural Finance : The Impact of Support Services for Credit Unions in Mexico

This paper studies the impact of a program that provides grants for technical assistance on the interest rates and outreach of credit unions in Mexico. Credit unions financing rural borrowers received grants in different years. The study uses prope...

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Main Authors:	Bruhn, Miriam, Reddy, Rekha, Ruiz Ortega, Claudia
Format:	Working Paper
Language:	English
Published:	World Bank, Washington, DC 2018
Subjects:	CREDIT UNION RURAL FINANCE TECHNICAL ASSISTANCE ACCESS TO FINANCE SMALL AND MEDIUM ENTERPRISES PROPENSITY SCORE MATCHING LENDING INTEREST RATE RISK MANAGEMENT NON-PERFORMING LOANS
Online Access:	http://documents.worldbank.org/curated/en/591351529583939227/Sowing-the-seeds-for-rural-finance-the-impact-of-support-services-for-credit-unions-in-Mexico http://hdl.handle.net/10986/29936

id	okr-10986-29936
recordtype	oai_dc
spelling	okr-10986-299362021-06-08T14:42:46Z Sowing the Seeds for Rural Finance : The Impact of Support Services for Credit Unions in Mexico Bruhn, Miriam Reddy, Rekha Ruiz Ortega, Claudia CREDIT UNION RURAL FINANCE TECHNICAL ASSISTANCE ACCESS TO FINANCE SMALL AND MEDIUM ENTERPRISES PROPENSITY SCORE MATCHING LENDING INTEREST RATE RISK MANAGEMENT NON-PERFORMING LOANS This paper studies the impact of a program that provides grants for technical assistance on the interest rates and outreach of credit unions in Mexico. Credit unions financing rural borrowers received grants in different years. The study uses propensity score matching and relies additionally on the timing of the grants to identify effects. The analysis shows that the program lowered lending interest rates by up to 2.6 percentage points (from a pre-program average of 17.8 percent). This drop appears to be due to lower operating costs and better risk management, as reflected in a lower nonperforming loan ratio. The program also raised credit unions' returns on assets and significantly increased the value of their loan portfolio. 2018-06-28T14:27:37Z 2018-06-28T14:27:37Z 2018-06 Working Paper http://documents.worldbank.org/curated/en/591351529583939227/Sowing-the-seeds-for-rural-finance-the-impact-of-support-services-for-credit-unions-in-Mexico http://hdl.handle.net/10986/29936 English Policy Research Working Paper;No. 8483 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper Latin America & Caribbean Mexico
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	CREDIT UNION RURAL FINANCE TECHNICAL ASSISTANCE ACCESS TO FINANCE SMALL AND MEDIUM ENTERPRISES PROPENSITY SCORE MATCHING LENDING INTEREST RATE RISK MANAGEMENT NON-PERFORMING LOANS
spellingShingle	CREDIT UNION RURAL FINANCE TECHNICAL ASSISTANCE ACCESS TO FINANCE SMALL AND MEDIUM ENTERPRISES PROPENSITY SCORE MATCHING LENDING INTEREST RATE RISK MANAGEMENT NON-PERFORMING LOANS Bruhn, Miriam Reddy, Rekha Ruiz Ortega, Claudia Sowing the Seeds for Rural Finance : The Impact of Support Services for Credit Unions in Mexico
geographic_facet	Latin America & Caribbean Mexico
relation	Policy Research Working Paper;No. 8483
description	This paper studies the impact of a program that provides grants for technical assistance on the interest rates and outreach of credit unions in Mexico. Credit unions financing rural borrowers received grants in different years. The study uses propensity score matching and relies additionally on the timing of the grants to identify effects. The analysis shows that the program lowered lending interest rates by up to 2.6 percentage points (from a pre-program average of 17.8 percent). This drop appears to be due to lower operating costs and better risk management, as reflected in a lower nonperforming loan ratio. The program also raised credit unions' returns on assets and significantly increased the value of their loan portfolio.
format	Working Paper
author	Bruhn, Miriam Reddy, Rekha Ruiz Ortega, Claudia
author_facet	Bruhn, Miriam Reddy, Rekha Ruiz Ortega, Claudia
author_sort	Bruhn, Miriam
title	Sowing the Seeds for Rural Finance : The Impact of Support Services for Credit Unions in Mexico
title_short	Sowing the Seeds for Rural Finance : The Impact of Support Services for Credit Unions in Mexico
title_full	Sowing the Seeds for Rural Finance : The Impact of Support Services for Credit Unions in Mexico
title_fullStr	Sowing the Seeds for Rural Finance : The Impact of Support Services for Credit Unions in Mexico
title_full_unstemmed	Sowing the Seeds for Rural Finance : The Impact of Support Services for Credit Unions in Mexico
title_sort	sowing the seeds for rural finance : the impact of support services for credit unions in mexico
publisher	World Bank, Washington, DC
publishDate	2018
url	http://documents.worldbank.org/curated/en/591351529583939227/Sowing-the-seeds-for-rural-finance-the-impact-of-support-services-for-credit-unions-in-Mexico http://hdl.handle.net/10986/29936
_version_	1764470849433239552

Sowing the Seeds for Rural Finance : The Impact of Support Services for Credit Unions in Mexico

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