Better Loans or Better Borrowers? : Impact of Meso-Credit on Female-Owned Enterprises in Ethiopia

This paper explores the impact of large, individual-liability loans on the growth of women-owned microenterprises in Ethiopia. Traditionally, microfinance institutions in Ethiopia have primarily catered to female enterprises with group lending sche...

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Main Authors:	Alibhai, Salman, Buehren, Niklas, Papineni, Sreelakshmi
Format:	Working Paper
Language:	English
Published:	World Bank, Washington, DC 2018
Subjects:	GENDER ENTREPRENEURSHIP FIRMS FEMALE ENTREPRENEURS MICROENTERPRISE MICROFINANCE SMALL AND MEDIUM ENTERPRISES MESOFINANCE GENDER INNOVATION LAB AFRICA GENDER POLICY WOMEN AND PRIVATE SECTOR DEVELOPMENT
Online Access:	http://documents.worldbank.org/curated/en/974551531236525468/Better-loans-or-better-borrowers-impact-of-meso-credit-on-female-owned-enterprises-in-Ethiopia http://hdl.handle.net/10986/29984

id	okr-10986-29984
recordtype	oai_dc
spelling	okr-10986-299842021-06-08T14:42:46Z Better Loans or Better Borrowers? : Impact of Meso-Credit on Female-Owned Enterprises in Ethiopia Alibhai, Salman Buehren, Niklas Papineni, Sreelakshmi GENDER ENTREPRENEURSHIP FIRMS FEMALE ENTREPRENEURS MICROENTERPRISE MICROFINANCE SMALL AND MEDIUM ENTERPRISES MESOFINANCE GENDER INNOVATION LAB AFRICA GENDER POLICY WOMEN AND PRIVATE SECTOR DEVELOPMENT This paper explores the impact of large, individual-liability loans on the growth of women-owned microenterprises in Ethiopia. Traditionally, microfinance institutions in Ethiopia have primarily catered to female enterprises with group lending schemes that provide very small loans. The limitations of this model are two-fold: in addition to these micro-loans being too small in size to fuel meaningful business growth, many of the female enterprises that are targeted with these loans face binding constraints, such as concentration in lower-growth sectors, lack of alternative job opportunities, limitations on time and mobility, and restrictive gender norms. The paper investigates the impact of credit to female entrepreneurs in a novel context, by examining larger loans, provided to growth-oriented women entrepreneurs. These entrepreneurs fall in the "missing middle" or "meso-finance" segment of the financial market because their credit needs are too large for microfinance, but not large enough for commercial banks. The paper uses a propensity score matching methodology to examine the impact of loans offered to women as part of the Women Entrepreneurship Development Project, a program funded by the World Bank International Development Association, that targets growth-oriented women entrepreneurs in Ethiopia. The results suggest that large, individual-liability loans can make a significant difference in accelerating growth in the business incomes and employment levels of women-owned enterprises. 2018-07-13T21:08:33Z 2018-07-13T21:08:33Z 2018-07 Working Paper http://documents.worldbank.org/curated/en/974551531236525468/Better-loans-or-better-borrowers-impact-of-meso-credit-on-female-owned-enterprises-in-Ethiopia http://hdl.handle.net/10986/29984 English Policy Research Working Paper;No. 8511 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 Africa Ethiopia
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	GENDER ENTREPRENEURSHIP FIRMS FEMALE ENTREPRENEURS MICROENTERPRISE MICROFINANCE SMALL AND MEDIUM ENTERPRISES MESOFINANCE GENDER INNOVATION LAB AFRICA GENDER POLICY WOMEN AND PRIVATE SECTOR DEVELOPMENT
spellingShingle	GENDER ENTREPRENEURSHIP FIRMS FEMALE ENTREPRENEURS MICROENTERPRISE MICROFINANCE SMALL AND MEDIUM ENTERPRISES MESOFINANCE GENDER INNOVATION LAB AFRICA GENDER POLICY WOMEN AND PRIVATE SECTOR DEVELOPMENT Alibhai, Salman Buehren, Niklas Papineni, Sreelakshmi Better Loans or Better Borrowers? : Impact of Meso-Credit on Female-Owned Enterprises in Ethiopia
geographic_facet	Africa Ethiopia
relation	Policy Research Working Paper;No. 8511
description	This paper explores the impact of large, individual-liability loans on the growth of women-owned microenterprises in Ethiopia. Traditionally, microfinance institutions in Ethiopia have primarily catered to female enterprises with group lending schemes that provide very small loans. The limitations of this model are two-fold: in addition to these micro-loans being too small in size to fuel meaningful business growth, many of the female enterprises that are targeted with these loans face binding constraints, such as concentration in lower-growth sectors, lack of alternative job opportunities, limitations on time and mobility, and restrictive gender norms. The paper investigates the impact of credit to female entrepreneurs in a novel context, by examining larger loans, provided to growth-oriented women entrepreneurs. These entrepreneurs fall in the "missing middle" or "meso-finance" segment of the financial market because their credit needs are too large for microfinance, but not large enough for commercial banks. The paper uses a propensity score matching methodology to examine the impact of loans offered to women as part of the Women Entrepreneurship Development Project, a program funded by the World Bank International Development Association, that targets growth-oriented women entrepreneurs in Ethiopia. The results suggest that large, individual-liability loans can make a significant difference in accelerating growth in the business incomes and employment levels of women-owned enterprises.
format	Working Paper
author	Alibhai, Salman Buehren, Niklas Papineni, Sreelakshmi
author_facet	Alibhai, Salman Buehren, Niklas Papineni, Sreelakshmi
author_sort	Alibhai, Salman
title	Better Loans or Better Borrowers? : Impact of Meso-Credit on Female-Owned Enterprises in Ethiopia
title_short	Better Loans or Better Borrowers? : Impact of Meso-Credit on Female-Owned Enterprises in Ethiopia
title_full	Better Loans or Better Borrowers? : Impact of Meso-Credit on Female-Owned Enterprises in Ethiopia
title_fullStr	Better Loans or Better Borrowers? : Impact of Meso-Credit on Female-Owned Enterprises in Ethiopia
title_full_unstemmed	Better Loans or Better Borrowers? : Impact of Meso-Credit on Female-Owned Enterprises in Ethiopia
title_sort	better loans or better borrowers? : impact of meso-credit on female-owned enterprises in ethiopia
publisher	World Bank, Washington, DC
publishDate	2018
url	http://documents.worldbank.org/curated/en/974551531236525468/Better-loans-or-better-borrowers-impact-of-meso-credit-on-female-owned-enterprises-in-Ethiopia http://hdl.handle.net/10986/29984
_version_	1764470983463272448

Better Loans or Better Borrowers? : Impact of Meso-Credit on Female-Owned Enterprises in Ethiopia

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