The Unbanked
To analyze the prospects for expanding financial access to the poor, bank professionals assessed 1,438 households in six provinces in Indonesia to judge their creditworthiness. About 40 percent of poor households were judged creditworthy according to the criteria of Indonesia's largest microfin...
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| Format: | Journal Article |
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World Bank
2012
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| Online Access: | http://hdl.handle.net/10986/4490 |
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okr-10986-44902021-04-23T14:02:18Z The Unbanked Johnston, Don Jr. Morduch, Jonathan access to loans collateral creditworthiness financial access households lack of collateral lender microfinance small businesses small loans To analyze the prospects for expanding financial access to the poor, bank professionals assessed 1,438 households in six provinces in Indonesia to judge their creditworthiness. About 40 percent of poor households were judged creditworthy according to the criteria of Indonesia's largest microfinance bank, but fewer than 10 percent had recently borrowed from a microbank or formal lender. Possessing collateral appeared as a minor determinant of creditworthiness, in keeping with microfinance innovations. Although these households were judged able to service loans reliably, most desired small loans. Calculations show that the bank, given its current fee structure and banking practices, would lose money when lending at the scales desired. So, while innovations have helped to extend financial access, it remains difficult to lend in small amounts and cover costs. 2012-03-30T07:12:37Z 2012-03-30T07:12:37Z 2008-12-01 Journal Article World Bank Economic Review 1564-698X http://hdl.handle.net/10986/4490 CC BY-NC-ND 3.0 IGO http://creativecommons.org/licenses/by-nc-nd/3.0/igo World Bank World Bank Journal Article East Asia and Pacific Indonesia |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| topic |
access to loans collateral creditworthiness financial access households lack of collateral lender microfinance small businesses small loans |
| spellingShingle |
access to loans collateral creditworthiness financial access households lack of collateral lender microfinance small businesses small loans Johnston, Don Jr. Morduch, Jonathan The Unbanked |
| geographic_facet |
East Asia and Pacific Indonesia |
| description |
To analyze the prospects for expanding financial access to the poor, bank professionals assessed 1,438 households in six provinces in Indonesia to judge their creditworthiness. About 40 percent of poor households were judged creditworthy according to the criteria of Indonesia's largest microfinance bank, but fewer than 10 percent had recently borrowed from a microbank or formal lender. Possessing collateral appeared as a minor determinant of creditworthiness, in keeping with microfinance innovations. Although these households were judged able to service loans reliably, most desired small loans. Calculations show that the bank, given its current fee structure and banking practices, would lose money when lending at the scales desired. So, while innovations have helped to extend financial access, it remains difficult to lend in small amounts and cover costs. |
| format |
Journal Article |
| author |
Johnston, Don Jr. Morduch, Jonathan |
| author_facet |
Johnston, Don Jr. Morduch, Jonathan |
| author_sort |
Johnston, Don Jr. |
| title |
The Unbanked |
| title_short |
The Unbanked |
| title_full |
The Unbanked |
| title_fullStr |
The Unbanked |
| title_full_unstemmed |
The Unbanked |
| title_sort |
unbanked |
| publisher |
World Bank |
| publishDate |
2012 |
| url |
http://hdl.handle.net/10986/4490 |
| _version_ |
1764391590995951616 |