The Invisible Collateral

Silu Muduli and Shridhar Kumar Dash

MPRA Paper from University Library of Munich, Germany

Abstract: A borrower may hesitate to borrow from her close relatives and family members as it costs them in terms of reduction in social insurance in the case of default. This invisible cost reduces credit risk. India’s household indebtedness survey shows some evidence on these borrowing preferences. This perspective on borrowing decisions derived from the community can be used as one of the dimensions in credit risk evaluation and in policy formulation.

Keywords: Network; Trust; Credit Risk (search for similar items in EconPapers)
JEL-codes: C92 D82 G21 (search for similar items in EconPapers)
Date: 2019-12-07
New Economics Papers: this item is included in nep-cfn, nep-ias and nep-net
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Citations: View citations in EconPapers (2)

Published in Economic and Political Weekly 54.48(2019): pp. 13-16

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:103687

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