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Diskussionspapiere - Hannover Economic Papers (HEP)

The Village Fund Loan: Who Gets It, Keeps It and Loses It?

Autor: Carmen Kislat and Lukas Menkhoff
Nummer: 490, Jan 2012, pp. 19
JEL-Class: O16, O17, G21

Abstract:
The village funds programme in Thailand is one of the biggest microfinance programmes in the world aiming at improving access to finance and income in rural areas. Earlier studies indicate that the programme is successful in realising its ambitions to some degree. We extend this work by analysing a second wave of a household survey and find that village fund borrowers are consistently characterised by a lower economic status; accordingly village fund loan are an important lifeline to those households. However, we cannot identify any significant substitution between village fund loans and other loans, raising doubts about the long-run impact of the village fund programme.

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