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Contribution Details

Type Published Research Report
Scope Discipline-based scholarship
Title Over-indebtedness and microfinance: Constructing an early warning index
Organization Unit
Authors
  • Vivien Kappel
  • Annette Krauss
  • Laura Lontzek
Language
  • English
Place of Publication Zürich
Publisher University of Zurich-Center for Microfinance
Date 2010
Abstract Text This study examines a method to collect and explore data on the conditions that could lead to crises due to microfinance clients’ over-indebtedness. A simplified version of one of the main approaches to early warning systems, the “signaling approach”, is proposed to construct a composite index for predicting over-indebtedness crises in the microfinance industry. The index is built for a sample of 13 countries, among them countries where overindebtedness crises and other repayment occurred in the past. Data stems from a triangulation of primary and secondary data sources. The sample results in a preliminary classification of the countries according to their current risk for an over-indebtedness crisis. The study suggests the proposed preliminary composition of the index and makes recommendations on the data collection for further validation of the index before it is expanded to a larger set of countries.
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Official URL http://www.cmf.uzh.ch/publications/Microfinance%20and%20OID%20-%20full%20version.pdf
Related URLs
Other Identification Number merlin-id:7867
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Funders responsAbility Council of Microfinance Equity Funds Triodos Investment Management