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This study aims to determine the affecting factors of repayment performance in Small Medium Enterprises (SMEs) in Indonesia for individual loan program. The data in this study is gathered by credit active during 2023 which contain of 300 samples from several region in Indonesia that came from one of Non-Banking Financial Institutions (NBFIs). The data is analyzed by logit regression model by Stata software version 18. The study indicates that the borrower’s income and amount of loan disbursements have significantly affected the repayment of the borrower’s outstanding loan for both principal and interest in time. Furthermore, the study shows that the higher amount of loan disbursement might affect the lower probability of defaulting due to high assessment of credit appraisal. Since the loan programs are delivered for individual for owner or management of Small Medium Enterprises (SMEs) in Indonesia. A prudent procedure is needed to establish for newer borrowers of the individual loan programs. The screening process consists of income cash flow analysis and how long the cash flow will be generated for repaying the programs. the novelty for this result enhances the current research for SMEs financing program in Indonesia for individual loan credit program. Specially credit loan program is delivered and sponsored by Indonesia government. Not much research focused on individual loan programs for SME’s owner or management. [ABSTRACT FROM AUTHOR]

This paper aims to empirically assess the effectiveness of training services on borrowers' repayment performance in a leading microfinance institution in Tunisia. The two training services analysed are financial education and entrepreneurial coaching. Financial education as basic capital management training does not impact repayment performance. On the other hand, coaching programs to strengthen the technical, managerial, and marketing skills of microentrepreneurs significantly improve repayment performance. These results are obtained through an ordered probit model with endogenous treatment accounting for selection bias and endogeneity problems arising from unobservable factors that influence both the use of training services and repayment quality. These results remain significant after restructuring the sample into more homogeneous borrowers' groups and confirm the hypotheses of the human capital theory. The determinants of training services are also explored. The findings confirm the importance of integrated microfinance strategies, especially in remote rural areas. Combining microcredit with coaching will empower the poor to foster their entrepreneurial skills, productivity, and thus their repayment ability. This study sheds more light on how microfinance institutions can improve their programs in developing countries, which often suffer from a lack of technical and vocational training, the main handicap for transitioning young people to the labour market. [ABSTRACT FROM AUTHOR]

This study tries to identify the accuracy of individual investors' capability to predict a borrower's creditworthiness in peer-to-peer lending markets and examine whether their ability is likely to evolve over time. The results of this study show that there is no significant difference between the predictive power of investors' ex-ante funding decision model and that of the ex-post repayment model over a borrower's repayment performance. Furthermore, the predictive power of investors' ex-ante funding decision over a borrower's repayment performance is shown to improve over time. It is also found that the main reason why investors' predictive power improves over time is because investors can assess more accurately the information provided by the platform operator and describe the borrower's characteristics. The results of this study are important as they confirm the possibility of optimizing and streamlining the P2P lending market, through the evolution of investors' decision making. [ABSTRACT FROM AUTHOR]

This paper examines the effect of the gender combination of client-loan officer pairs on loan repayment in an Ecuadorian microfinance institution. We show that among the four possible client-loan officer gender pairs i.e. female client-female loan officer, female client-male loan officer, male client-male loan officer and male client-female loan officer, the most favourable pairs in terms of repayment are those with female loan officers whereas the least favourable are those with male loan officers. We also show that repayment is even further enhanced for all client-loan officer pairs when the client's previous loan officer was a woman. Our findings point to relational differences between male and female loan officers when interacting with microfinance clients, which is also highlighted by our qualitative insights from the field. [ABSTRACT FROM AUTHOR]

This paper provides a descriptive analysis of repayment performance for pay-as-you-go solar lamps, based on pilots conducted in six countries in sub-Saharan Africa and Asia during 2014 and 2015. In our sample, 95% of accounts were eventually paid off by the end of the observation period, and the median time to ownership was one week less than the nominal repayment term. Default rates of 11% and 7% were observed with a grace period of 50% and 100% of the repayment term, respectively. We document differences between weekly and monthly accounts (e.g., although time to ownership and on-time performance were better in weekly accounts, longer-term default rates were lower for monthly accounts). The observed payment patterns demonstrate that customers make extensive use of the flexibility allowed in rent-to-own models (e.g., fewer than 30% of customers followed a regular schedule of fixed installments). The analysis identified repayment frequency as one key factor associated with this behavior, as flexible payment patterns were much more likely to occur in weekly accounts than in monthly accounts. This paper highlights the importance of business model design in the diffusion of off-grid energy products in developing countries, outlining opportunities for future research in this domain. • Descriptive analysis of repayment performance for pay-as-you-go solar lamps • 95% of accounts were eventually paid off by the end of the observation period. • Default rate of 11% and 7%, with grace period of 50% and 100% of the repayment term • Customers make extensive use of the flexibility allowed in rent-to-own models. • Differences between weekly and monthly accounts for off-grid energy [ABSTRACT FROM AUTHOR]

This study was conducted in Gedio zone small scale enterprise financed by micro finance institution. The main objective the study was to evaluate and determine the factor that determines loan repayment performance of small scale enterprise financed by yirgachefeMFI. For the success of the study both primary and secondary data were collected to determine the loan repayment performance of small scale enterprises in Gedio zone. Questionnaire were administered to 50 borrower and manager of MFI. The data gathered are tabulated and interpreted for ease of analysis and suitability for the reader.

This study attempts to identify the characteristics and behavioral features of student borrowers, and to investigate how well individual investors incorporate the uniqueness of these borrowers in their funding decisions. We find that student borrowers are distinct from other types of borrowers, not only with respect to factors that existed prior to joining the market, but also in terms of information generated during loan requests, subsequent cancellation behavior, repayment performance, and even in the composition and predictive accuracy of loan repayment models. However, individual investors are not fully aware of the unique attributes of student borrowers in their funding decisions. [ABSTRACT FROM AUTHOR]

This study aims to determine why investors leave a peer-to-peer (P2P) lending market, and the pathways through which several factors affect investor churn. To this end, this study performed Cox proportional hazard and Kaplan-Meier survival analyses, as well as a linear regression analysis of data from Moneyauction, Korea's first, but recently failed, P2P platform. The results show that investors' investment patterns (i.e., investment frequency, amount, and method) affect churn directly or indirectly via investment profitability. This result supplements the findings in the stock market that the higher the trading frequency and volume are, the lower the returns are in the P2P lending market. Furthermore, this study is the first to cover the issue of investor churn in P2P lending markets and to reveal the detailed pathways of investors' investment patterns in both the P2P and traditional financial markets in terms of profitability and churn. [ABSTRACT FROM AUTHOR]

Tanzania is a low-income country, with a high proportion of its population below the poverty line. Like most developing countries, access to financial services from formal microfinance institutions (MFIs) is limited. Recently, however, access to financial services in both rural and urban areas has increased, with group lending programs playing a significant role in this transformation. To assess the repayment performance of group lending programs, this study highlights the case of BRAC Tanzania, a leading nongovernmental organization. Primary data were collected through questionnaires administered to 177 members of ten randomly selected groups and interviews with BRAC Tanzania officials, whereas secondary data were obtained from BRAC Tanzania reports and other documents. Repayment performance is measured by the proportion of the portfolio that is overdue (arrears), the proportion of the portfolio that is overdue by 30 days or more (portfolio at risk), and the percentage of the loan portfolio that is written off. The results indicate remarkably low levels of arrears, portfolio at risk, and write-offs, implying high repayment performance. This success reflects good institutional design, such as frequent client visits, frequent repayment schedules, and a strict loan approval process. In addition, from the member side, this success is owing to several factors such as sanctions, contributions by other group members, and the protection of future access to credit. [ABSTRACT FROM AUTHOR]

This empirical article looks at the determinants of joint-liability lending repayment performance among the two largest microfinance group-lending organisations in South Africa. Most empirical work on repayment performance does not focus on the characteristics of group-based lending methodologies. This study is an attempt to fill this gap in South African microfinance literature. The results of the logit analysis uncover interesting findings. The study uses the Poverty Wealth Ranking score variable to show the ability of individuals with little or no collateral to be good borrowers. Smaller loan sizes are found to perform better than larger loans. An important contribution of the article is analysing the impact of group homogeneity on repayment performance. It was found that large group sizes and groups made up of male and female (as opposed to groups with only females) can have a negative impact on repayment performance. The findings also indicate that the more homogeneous a group in industry type the better the repayment performance.

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Purpose – The purpose of this paper is to evaluate the role of social capital in a microfinance contract. Design/methodology/approach – Systematic review of the theoretical and empirical literature on the role of social capital in microfinance. Findings – The theoretical literature has shown using models of peer selection, peer monitoring and peer pressure that group lending with joint liability overcomes both the informational and enforcement failures present in credit markets for poor. However findings from the empirical literature conclude that social capital should not be taken as a single concept but should be considered in light of its different aspects which may be having different effects on the performance. For example, the trust between the borrowers, cultural and social homogeneity has been found to have more significant affect on repayment performance in contrast to the incentives due to peer pressure. The groups formed by family members and relatives are consistently been reported to have weakening influence on repayment. Practical implications – For a same program the effect of social capital on performance can be different for different geographies and different classification of subjects and thus should be studied before initiating a microfinance program in any social setting. Social implications – The borrowers should be encouraged to form groups with others who are more trustworthy and not with those they are just having an acquaintance with. The borrowers should be encouraged to come to aid of those who are victims of negative externalities. The positive experiences will lead to reciprocity of actions in future. The borrowers should be discouraged to form groups with family members and relatives. Originality/value – It analyzes both theoretical and empirical literature by disentangling different aspects of social capital within groups and their effects on group performance. [ABSTRACT FROM AUTHOR]

Micro-entrepreneurs in developing countries are often excluded from bank credit because they can not provide sufficient material collaterals and also because the costs of screening and monitoring are very high. Following this point of view, we can say that micro-financial intermediation complements bank financing of micro- entrepreneurs. Based on the analysis of 70 group loans of 5 Cameroonian, we show that group loans granted by MFIs in Cameroon has an aspect a non-tangible collateral due to variables underlying their constitution and their functioning. [ABSTRACT FROM AUTHOR]

One of the main challenges facing the Agriculture Bank of Iran regarding lending loans is the high probability of default by farmers. Several factors could be involved in this issue and should be considered in order to control and reduce the risk in the failure of repayment. This study aimed to examine the factors affecting the repayment performance of agricultural loans in the city of Maragheh in East Azarbaijan Province of Iran. Required data were obtained from a sample of 779 individual farmers who had previously received loans from Agricultural Bank during the period 2004-2008. Nested Logit Model (NLM) was applied for analyzing the data and, for this purpose, STATA software was used in the study. Results revealed that having an activity besides farming, extension of the repayment period of the loan, and large volume of received loans are the factors that had significant negative impacts on loan repayment. On the other hand, factors including high interest rates of loans, having collateral of guarantor, services received from the banks, and long term maturity period for the loans increase the probability of timely loan repayment significantly. [ABSTRACT FROM AUTHOR]

The socio-economic impacts of microcredits on women's welfare were studied in northeastern South Africa using a qualitative semi-structured interviewing method. The study focuses particularly on the benefits, disadvantages and challenges obtained from The Small Enterprise Foundation (SEF) microcredit village programmes (Micro Credit Programme (MCP) and the Tšhomisano Credit Programme (TCP)). Impacts of microcredits and a comparison of two programmes were analysed on a household level. The results revealed that a number of the poorest women have been released from deepest poverty through the opportunities provided by SEF. The MCP clients, who tend to have a better starting point, seemed to be more educated, able to diversify and improve their businesses as well as being more capable of protecting themselves against vulnerability than the poorer TCP clients. Many repayment problems were caused by group heterogeneity. Particularly in the MCP, the incentive to free-ride seemed to be a problem phenomenon. These drawbacks demonstrate that there are still some unresolved disadvantages in the programmes. [ABSTRACT FROM AUTHOR]