Publication Date

5-2013

Document Type

Article

Publication Title

Development Policy Review

Volume

31

Issue

3

Abstract

Employing data for 34,255 loans made by the Bangladesh Rural Advancement Committee (BRAC) to 12,455 repeat borrowers during the 2002-6 period, this article examines the relationship between borrowers’ asset holdings and microloan repayment. Estimating a series of binomial probit specifications, it finds a positive relationship between land ownership and loan repayment; however, taken collectively, ownership of non-land assets diminishes the likelihood of repayment. Influences of specific assets on repayment probabilities vary across asset types: ownership of land, corrugated tin houses, vans and rickshaws increases the likelihood of repayment, while ownership of sewing machines, televisions, radios and bicycles corresponds with a decreased repayment probability.

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