USD Trans-Border Institute • 1 • www.sandiego.edu/tbi ...microcredit advocates believe that access to credit enables people to improve their own lives and economic situation. ...this brief examines the use of microcredit lending in the U.S.-Mexico border region, a complex, highly metropolitan area. Microcredit Lending in the Border Region Microcredit lending has become a major innovation in ant...

Does related lending, the practice of bankers extending credit to their own enterprises, help financial development by allowing bankers to assess risk ex ante and monitor borrowers ex post, or does it hinder financial development by creating a mechanism for bankers to loot their own banks? Drawing on both cross-country regressions and case studies we argue that whether related lending is positi...

In micro-lending markets, lack of recorded credit history is a significant impediment to assessing individual borrowers’ creditworthiness and therefore deciding fair interest rates. This research compares various machine learning algorithms on real data test their efficacy at classifying borrowers into categories. We demonstrate that off-the-shelf multi-class classifiers such as random forest c...

Access to credit markets is generally considered a hallmark of developed economies. In the United States, most households appear to have substantial ability to borrow; indeed, households in the United States have an average of over $23,000 in nonmortgage debt alone. Nevertheless, economists often point to limited borrowing opportunities for lower-income households to explain anomalous findings ...

U.S. fair-lending law prohibits lenders from making credit determinations that disparately affect minority borrowers if those are based on characteristics unrelated to creditworthiness. Using an identification under this rule, we show risk-equivalent Latinx/Black pay significantly higher interest rates GSE-securitized and FHA-insured loans, particularly in high-minority-share neighborhoods. We ...

BIS Working Papers are written by members of the Monetary and Economic Department of the Bank for International Settlements, and from time to time by other economists, and are published by the Bank. The views expressed in them are those of their authors and not necessarily the views of the BIS. Abstract Motivated by the frequently observed link between commercial property price volatility and b...

Can a credit expansion induce a boom and bust in house prices and real economic activity? This paper exploits the federal preemption of national banks from local laws against predatory lending to gauge the effect of the supply of credit on the real economy. Specifically, we exploit the heterogeneity in the market share of national banks across counties in 2003 and that in state anti-predatory l...

Trade credit refers to providing goods and services on a deferred payment basis. Commercial credit management is a matter of great importance for most small and medium enterprises (SMEs), since it represents a significant portion of their assets. Commercial lending involves assuming some credit risk due to exposure to default. Thus, the management of trade credit and payment delays is strongly ...

In the credit decision-making process, both an applicant’s creditworthiness and their affordability should be assessed. While credit scoring focuses on creditworthiness, affordability is often checked on the basis of current income and estimated current consumption as well as existing debts stated in a credit report. Contrary to that static approach, a theoretical framework for dynamic affordab...