The Potential of Digital Credit to Bank the Poor
AEA Papers and Proceedings
vol. 108,
May 2018
(pp. 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.Citation
Björkegren, Daniel, and Darrell Grissen. 2018. "The Potential of Digital Credit to Bank the Poor." AEA Papers and Proceedings, 108: 68-71. DOI: 10.1257/pandp.20181032Additional Materials
JEL Classification
- E42 Monetary Systems; Standards; Regimes; Government and the Monetary System; Payment Systems
- G21 Banks; Depository Institutions; Micro Finance Institutions; Mortgages
- I32 Measurement and Analysis of Poverty
- I38 Welfare, Well-Being, and Poverty: Government Programs; Provision and Effects of Welfare Programs
- O12 Microeconomic Analyses of Economic Development
- O16 Economic Development: Financial Markets; Saving and Capital Investment; Corporate Finance and Governance