DETERMINANT OF MICROCREDIT REPAYMENT

Farida (), Hermanto Siregar (), Nunung Nuryartono () and Eka Intan Kp ()
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Farida: UPI YAI Jakarta
Hermanto Siregar: Bogor Agricultural University
Eka Intan Kp: Bogor Agricultural University

Bulletin of Monetary Economics and Banking, 2016, vol. 19, issue 1, 57-80

Abstract: This paper investigate the determinants of microcredit repayment by employing the logistic regression on micro-business households in Pati, Central Java. The result of this study reveals that loan repayment affected significantly by the business lines, food consumption spending, side job, other loan sources, collateral, and credit constrained. Interestingly, the result concludes that the loan repayment are no longer influenced by moral hazard, since the characteristics such as gender, education level, age, experience do not significantly encourage borrowers to repay. This paper also conform the important role of peer-screening process on hindering the credit default.

Keywords: micro-credit; repayment; credit constrained; moral hazard (search for similar items in EconPapers)
JEL-codes: C13 G21 (search for similar items in EconPapers)
Date: 2016
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Persistent link: https://EconPapers.repec.org/RePEc:idn:journl:v:19:y:2016:i:1c:p:57-80

DOI: 10.21098/bemp.v19i1.600

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