Formal and Informal Rural Credit in Four Provinces of Vietnam

Mikkel Barslund and Finn Tarp

No 07-07, Discussion Papers from University of Copenhagen. Department of Economics

Abstract: This paper uses a survey of 932 rural households to uncover how the rural credit market operates in four provinces of Vietnam. Households obtain credit through formal and informal lenders. Formal loans are almost entirely for production and asset accumulation, while informal loans are used for consumption smoothening. Interest rates fell from 1997 to 2002, reflecting increased market integration. Moreover, the determinants of formal and informal credit demand are distinct. While credit rationing depends on education and credit history, in particular, regional differences in the demand for credit are striking. A ‘one size fits all’ approach to credit policy in Vietnam would be inappropriate.

Keywords: rural credit; household survey; Vietnam (search for similar items in EconPapers)
JEL-codes: O12 O16 O17 O18 (search for similar items in EconPapers)
Pages: 36 pages
Date: 2007-03
New Economics Papers: this item is included in nep-agr, nep-dev and nep-mfd
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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Related works:
Journal Article: Formal and Informal Rural Credit in Four Provinces of Vietnam (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:kud:kuiedp:0707

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