Geetha Nagarajan

Microfinance in developing countries: accomplishments, debates, and future directions

This paper provides an overview of the microfinance industry in developing countries. It highlights the early development of the concept of microfinance and identifies some of the key issues and debates concerning its performance in terms of outreach, sustainability, and impact. Studies are summarized that report on industry performance by region. The frontiers for the industry involve broadening the range and diversity of services provided to existing clients and expanding services to difficult‐to‐reach populations, especially the remote, poorest, and the youth. In countries where the industry is still small and fledgling, the challenge is often one of addressing the problems of reaching people in remote and conflict‐affected areas.

Informal finance through land pawning contracts: Evidence from the Philippines

Land pawning contracts have increased in importance in Philippine rice growing villages, and this article examines the determinants of choice of pawning contracts and the observed loan size. The analysis shows that pawning is an informal credit instrument used by small farmers to obtain large loans to finance productive investments, such as non‐farm employment, where the returns to investment are high. The econometric results suggest that poorer farm households pawn‐out land, while wealthier farm households pawn‐in. The observed loan size is explained by reputation of pawners and rice cropping intensity in the region.

Does Membership Homogeneity Matter for Group‐based Financial Services? Evidence from the Gambia

This paper examines the effect of membership composition on the components of group design to provide financial services, and on the performance of these groups. Regression results based on data from RoSCAs in the Gambia show that gender homogeneity is less likely to affect components of group design than is homogeneity in income generating capacity of members. Membership homogeniety does not directly affect the repayment performance of the members but only indirectly through the components of the group design. — Cet article examine l’incidence de la composition sur les composantes et la performance des groupes constitues en vue de la fourniture de services financiers. Selon les resultats d’une analyse de regression basee sur les donnees de “RoSCA” en Gambie, il apparait que l’homogeneite du genre influe moins sur les composantes de la conception des groupes que l’homogeneite de la capacite des groupes a generer des revenus. En ce qui concerne la performance en matiere de remboursement, l’incidence de l’homogeneite de la composition n’est pas directe mais indirecte au travers des composantes de la conception des groupes.

Segmentation in the informal credit markets: the case of the Philippines

This paper explains market segmentation that occurs in the Philippine informal credit markets through the matching of borrowers and lenders by their occupational specializations to internalize transaction costs and facilitate economic activity. The regression results support a predictable pattern of matching farmer lenders with borrowers specialized in non-farm activities and trader lenders with borrowers specialized in farming.

Incorporating finance into a modified subsector framework: The fertilizer subsector in The Gambia

Abstract The subsector analytical framework as currently employed is usually limited to examining a subsector in a single market, product or input. The framework often excludes an explicit analysis of financial markets due to the assumptions that they function in a competitive environment or are considered less important than other features of the subsector. These assumptions are inappropriate in most developing countries where financial markets are imperfect and access to financial services is rationed. This paper proposes a modified subsector framework that incorporates the financial markets affecting a given subsector to more fully explain operational efficiency and market technology. The framework is used to study the fertilizer subsector in The Gambia.