Formal and Informal Household Credit in Colombia

Ana Iregui, Ligia Alba Melo-Becerra (lmelobec@banrep.gov.co), Maria Ramirez-Giraldo and Ana Tribin
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Ligia Alba Melo-Becerra: Banco de la República de Colombia
Authors registered in the RePEc Author Service: Ligia Melo (lmelobec@banrep.gov.co)

Chapter 5 in Financial Decisions of Households and Financial Inclusion: Evidence for Latin America and the Caribbean, 2018, pp 125-156 from Centro de Estudios Monetarios Latinoamericanos, CEMLA

Abstract: This paper provides evidence on the determinants of household credit, formal and informal, in both urban and rural areas in Colombia. We also study the factors that affect the likelihood that a household is in arrears. Results show that the probability that a household has credit is positively related to marital status (married), education, income, household size, home ownership, and labor market participation. Estimates indicate that income and education are positively correlated with the probability of having a formal loan, and negatively related to the likelihood of having informal credit. Finally, household income, credit usage, and unexpected events increase the probability of credit default.

Keywords: household debt; formal credit; informal credit; credit default; Colombia. (search for similar items in EconPapers)
JEL-codes: C25 D12 G21 R22 (search for similar items in EconPapers)
Date: 2018
ISBN: 978-607-8582-00-6 (online)
Note: Joint Research Program of the Central Bank Researchers Network
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