Repayment Performance in Group Lending Programs: A Survey

Repayment versus Investment Conditions and Exclusivity in Lending Contracts

Repayment versus Investment Conditions and Exclusivity in Lending Contracts Lenders condition future loans on some index of past performance. Typically, banks condition future loans on repayments of earlier obligations whilst international organizations (official lenders) condition future loans on the implementation of some policy action (‘investment’). We build an agency model that accounts fo...

Monitoring Repayment in Online Peer-to-peer Lending

Recent years have seen an explosion in the use of Peer-to-Peer (P2P) lending, in which websites such as Kiva and Microplace offer individuals the ability to make loans to microfinance borrowers across the developing world. Such sites offer a fascinating new example of a two-tiered monitoring device in which micro-finance institutions (MFIs) maintain dynamic relationships with borrowers and P2P ...

Competitive Lending with Partial Knowledge of Loan Repayment

Maria Lehner: Group versus Individual Lending in Microfinance Group Lending versus Individual Lending in Micro…nance

Micro…nance is typically associated with joint liability of group members. However, a large part of micro…nance institutions rather o¤ers individual instead of group loans. We analyze the incentive mechanisms in both individual and group contracts. Moreover, we show that micro…nance institutions o¤er group loans when the loan size is rather large, re…nancing costs are high, and competition betw...

Is Grameen Lending Efficient? Repayment Incentives and Insurance in Village Economies

Many believe that a key innovation by the Grameen Bank is to encourage borrowers to help each other in hard times. To analyse this, we study a mechanism design problem where borrowers share information about each other, but their limited side contracting ability prevents them from writing complete insurance contracts. We derive a lending mechanism which efficiently induces mutual insurance. It ...