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Access to Consumer Credit in the UK

Author

Listed:
  • Solomon Y. Deku

    (University of Hull)

  • Alper Kara

    (University of Hull)

  • Phil Molyneux

    (Bangor University)

Abstract

This paper investigates household access to consumer credit in the UK using information on 58,642 households between 2001 and 2009. Employing a treatment effects model and propensity score matching, we find that non-white households are less likely to have financing compared to white households. We also find that even if they obtain financing the intensity of borrowing is lower than for white households.Overall, non-white households seem to be in a weaker position to access consumer credit in the UK.

Suggested Citation

  • Solomon Y. Deku & Alper Kara & Phil Molyneux, 2014. "Access to Consumer Credit in the UK," Working Papers 14004, Bangor Business School, Prifysgol Bangor University (Cymru / Wales).
    • Handle: RePEc:bng:wpaper:14004
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    References listed on IDEAS

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    Cited by:

    1. Will Dobbie & Andres Liberman & Daniel Paravisini & Vikram Pathania, 2021. "Measuring Bias in Consumer Lending [Loan Prospecting and the Loss of Soft Information]," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 88(6), pages 2799-2832.
    2. Gamze Ozturk Danisman & Amine Tarazi, 2020. "Financial inclusion and bank stability: evidence from Europe," The European Journal of Finance, Taylor & Francis Journals, vol. 26(18), pages 1842-1855, December.
    3. Alper Kara & Philip Molyneux, 2017. "Household Access to Mortgages in the UK," Journal of Financial Services Research, Springer;Western Finance Association, vol. 52(3), pages 253-275, December.
    4. Zibei Chen & Minchao Jin, 2017. "Financial Inclusion in China: Use of Credit," Journal of Family and Economic Issues, Springer, vol. 38(4), pages 528-540, December.
    5. Uduakobong Inyang, 2022. "Risks to credit access in a developing economy:Focus on household characteristics and the choice of credit in the Niger Delta Region of Nigeria," International Journal of Research in Business and Social Science (2147-4478), Center for the Strategic Studies in Business and Finance, vol. 11(2), pages 228-240, March.
    6. Gregory Gadzinski & Alessio Castello, 2022. "Combining white box models, black box machines and human interventions for interpretable decision strategies," Judgment and Decision Making, Society for Judgment and Decision Making, vol. 17(3), pages 598-627, May.
    7. Adair Morse & Karen Pence, 2021. "Technological Innovation and Discrimination in Household Finance," Springer Books, in: Raghavendra Rau & Robert Wardrop & Luigi Zingales (ed.), The Palgrave Handbook of Technological Finance, pages 783-808, Springer.
    8. Kara, Alper & Zhou, Haoyong & Zhou, Yifan, 2021. "Achieving the United Nations' sustainable development goals through financial inclusion: A systematic literature review of access to finance across the globe," International Review of Financial Analysis, Elsevier, vol. 77(C).
    9. Jane Brown & Anders Wäppling & Helen Woodruffe-Burton & Kate Black, 2017. "The orbit of consumer credit choices," Journal of Financial Services Marketing, Palgrave Macmillan, vol. 22(2), pages 85-96, June.
    10. Shahid Manzoor Shah & Amjad Ali, 2022. "A Survey on Financial Inclusion: Theoretical and Empirical Literature Review," Journal of Policy Research (JPR), Research Foundation for Humanity (RFH), vol. 8(4), pages 310-330, December.
    11. Y Deku, Solomon & Kara, Alper & Smith, Kay & Xia, Mengxue, 2022. "Ethnic minorities’ access to mortgages in the UK: The undesirable impact of the Great Financial Crisis," Finance Research Letters, Elsevier, vol. 45(C).
    12. repec:cup:judgdm:v:17:y:2022:i:3:p:598-627 is not listed on IDEAS

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    More about this item

    Keywords

    Consumer Credit; Financial Exclusion; Racial Origin;
    All these keywords.

    JEL classification:

    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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