The Potential of Digital Credit to Bank the Poor

Daniel Björkegren and Darrell Grissen

AEA Papers and Proceedings, 2018, vol. 108, 68-71

Abstract: Many households in developing countries lack access to credit: physically providing small loans to poor and remote populations is costly. However, the digitization of developing countries enables a new model: digital credit delivered directly via mobile phones. Mobile money enables inexpensive financial transfers, and mobile phones capture behavior that can predict repayment when mined with machine learning. This paper evaluates the potential for digital credit to reach those excluded from current financial systems.

JEL-codes: E42 G21 I32 I38 O12 O16 (search for similar items in EconPapers)
Date: 2018
Note: DOI: 10.1257/pandp.20181032
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Citations: View citations in EconPapers (15)

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