Financial Channels, Property Rights, and Poverty: A Sub-Saharan African Perspective

Abstract

The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent.

Are competitive microfinance services worth regulating? Evidence from microfinance institutions in Sub‐Saharan Africa

“…This has a negative influence on the operation cost of MFIs and by extension, the overall portfolio profitability. Thirdly, the poor operate at the margins of economic systems, carry higher default risk, lack entrepreneurial capacity coupled with lack of financial track record and collateral (Fafchamps, 2014;Fletschner and Kenney, 2014;Singh and Huang, 2016;Wellalage and Locke, 2016;Matamanda and Chidoko, 2017;Otchere et al, 2017) adversely impacts on their chances of accessing finance. Limited earnings by the poor are broadly following the economic interest of traditional banks to avoid profound portfolio risk.…”