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Identifying Gender Disparities on the Time to Repay Microfinance Group Loans: Evidence from Mexico

Author

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  • Bátiz-Zuk Enrique
  • González-Holden Alexa

Abstract

This paper investigates how gender disparities affect the time to repay group micro-finance loans using survival analysis and hazard decomposition techniques. We also control for the effect of the COVID-19 pandemic on the time needed by micro-finance loan borrowers to repay. We use a large sample of bank microfinance group loans from August 2017 to August 2021. Despite the fact that female borrowers' overall default rate is smaller, our unconditional estimates show that female borrowers default almost the equivalent of three consecutive installments earlier. Moreover, this result persists when we control for micro, industry, and macroeconomic factors. We also observe that the COVID-19 pandemic materialized as a spike in aggregate default rates that gradually reduced afterward. Our study identified a potential gender gap that has been understudied in the literature.

Suggested Citation

  • Bátiz-Zuk Enrique & González-Holden Alexa, 2023. "Identifying Gender Disparities on the Time to Repay Microfinance Group Loans: Evidence from Mexico," Working Papers 2023-07, Banco de México.
    • Handle: RePEc:bdm:wpaper:2023-07
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Credit markets; Microfinanceloan; Group lending; Gender; Survival analysis;
    All these keywords.

    JEL classification:

    • C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance

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