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This study identifies the factors that affect the knowledge of mortgage loans' total cost.

Empirical research utilizing a survey administered through in-home interviews was conducted. This study adopts the elaboration likelihood model (ELM) theory to analyze the influence of information shortcuts and borrowers' abilities and motivations on the knowledge of mortgage loans' total cost.

The results support that the use of the price–quality cue and brand credibility have negative and positive effects, respectively, on the knowledge of mortgage loans' total cost. Households' primary income earners have a higher knowledge of mortgage loans' total cost. The results also show that the household's primary income earners who are price conscious and brand nonbelievers have more knowledge of mortgage loans' total cost.

Price knowledge studies in financial services, especially in the mortgage loan industry, are scarce. Consequently, understanding the price knowledge level for mortgage loans and its potential antecedents has been insufficient.

This paper aims to provide insights into the characteristics of avid non-fiction book readers, exploring their typical demographic characteristics in relation to reading volume and frequency. It also investigates their comparative library usage in relation to avid fiction readers, as well as their motivation to read, and barriers to reading. Findings from the subset of self-identified avid non-fiction readers from the 2015 International Study of Avid Book Readers are interrogated to provide insights into this under-researched group.

The authors have used a single-stage mixed-methods approach, using data from both qualitative and quantitative items in an international survey.

The quantitative data analysis of this study suggests that avid non-fiction book readers were more likely to be men and older than avid fiction readers, and that they also tended to read less frequently, though avid non-fiction readers tended to read a greater volume of books. Avid fiction readers reported greater library usage, and thus unsurprisingly were found to have a greater borrowing tendency than non-fiction readers. Our qualitative findings around reading motivation identified a range of recurrent themes. The authors also found three key barriers to reading: time, book access and concentration.

The findings of this study provide unique insights into the characteristics, preferences and motivation of avid non-fiction readers, with the relationship between pleasure and the reading of non-fiction of particular interest.

When faced with a financial crisis, debtor countries rarely choose to default on their international financial obligations. Instead, they typically choose to renegotiate their debt service obligations. According to a number of economists, the main motivating factor behind borrowers' and creditors' willingness to restructure is the benefit associated with preserving international trade ties. This raises an interesting question: is the benefit associated with maintaining international trade ties shared equally between the borrower and creditor banks? Or is the outcome dependent on a so-called ‘bargaining game’ between the borrower and creditor banks, and if so, can we identify these variables? According to our analysis, as a borrower's trade ties with developed countries strengthen, the borrower's (and/or creditor's) bargaining power diminishes (strengthens) and it thereafter agrees to restructure at less favourable terms. However, even after controlling for trade ties, we found that major borrowers were able to extract more concessions from the lenders.

To provide a selective review of most recent developments in experimental economics of banking and lending and to summarize and synthesize the experiment designs and results in banking under asymmetric information.

The review includes recently published or working papers (2006–2013) that exclusively employ experimental economics methodology, especially for studying the impact of formal or informal institutions on lending in credit markets.

The results of the reviewed experimental studies provide support for the important role of both informal (e.g., relationship banking and reputation) and formal (e.g., third-party enforcement; collateral) institutions and their impact on credit market performance, as well as the importance of studying the interaction of the two types of institutions.

The number of studies reviewed is fairly small but growing, indicating that this is the area of growing significance.

Controlled economic experiments are better able to address the questions regarding the direction of causality in empirical relationships. Economic experiments are particularly useful in studying complex markets like credit and capital and in eliciting specific effects of institutions on credit market performance. Such well-established empirical relationships will be able to provide guidance for policy making for financial market reform.

This is the first review of laboratory research in banking and lending under asymmetric information that aims to call attention to this area of research and serves as a starting point for an interested researcher and provide future direction.

The purpose of this study is to examine the impact of interest free micro credit loans on the lives and business of the female borrowers.

Both primary and secondary data have been used. Case studies of four different female entrepreneurs have been included as part of the research. The observation was conducted over an extended period of time. Subsequently, interviews were conducted with four beneficiaries to know the role played by interest free micro credit loans in improving (or not!) their lives and businesses.

Interest free micro credit loans played a significant role in bringing a positive change in the lives of the borrowers. Clients mentioned that “zero interest rate” and “flexible repayment schedules” were the main reason for obtaining loans from this source. Further, they suggested that there is a need for training/workshops, feedback/monitoring, networking and online repayment system to make interest free micro credit loans more successful.

The focus of the study is limited to only four female borrowers in Karachi. Future studies can include other cities and cross-gender comparisons for better understating.

This study will help microfinance organizations to assess the problems faced by the borrowers; it will also shed light on the motivations of borrowers.

Interest free micro credit loans were provided to women entrepreneurs in a social experiment and implications were observed.

The aim of this paper is to study the role of bribery in subsidized credit markets in developing countries. First, the authors use the data to test whether more productive borrowers will pay larger or smaller bribes since the theoretical literature offers conflicting findings regarding the relationship between the size of the bribe and the productivity of borrowers. Second, the authors test whether being eligible to borrow from a microfinance institution affects the frequency or the magnitude of the bribe paid when borrowing from a (non-microfinance) subsidized bank.

The empirical analysis is based on existing theoretical models of bribery. The data set uses publicly available survey data from the Bangladesh Institute for Development Studies. The primary linear model is estimated using OLS. Because left-censoring affects the data, the authors also estimate a Tobit model. Finally, to correct for potential selection bias, the authors also estimate a Heckman selection model.

The authors find that more productive borrowers pay lower bribes than less productive borrowers and that being MFI-eligible affects the frequency of bribery, but not the magnitude of the bribe.

To the authors' knowledge, the paper is the first empirical study of bribery in subsidized credit markets.

This paper analyzes an individual lending credit market in a rural society, where potential borrowers have a dynamic incentive of strategic default, and a benevolent lender gives them a credible threat to cut future credit when loands are not repaid. A crucial issue is that social sanction of default depends on the default rate in the society. Our analysis suggests that for a relatively small financing cost, a credit market exists where borrowers have little motivation to default voluntarily, associated with intense social sanctions. The results also reveal that a relatively large financing cost causes the credit market to collapse, since it raises motivation of default, associated with less intense social sanctions. These results could justify government support to reduce the lender’s financing cost. The model further illustrates the plausibility of two equilibria: a low default rate associated with a low lending rate and intense social sanctions, and a high default rate with a high lending rate and less intense social sanctions. This could explain the possibility that the default rate is different from village to village even though these societies seem to share an almost identical environment.

The purpose of this paper is to investigate how bank size affects the role of information asymmetry on financial access in a panel of 162 banks in 39 African countries for the period 2001-2011.

The empirical evidence is based on instrumental variable fixed effects regressions with overlapping and non-overlapping bank size thresholds to control for the quiet life hypothesis (QLH). The QLH postulates that managers of large banks will use their privileges for private gains at the expense of making financial services more accessible to the general public. Financial access is measured with loan price and loan quantity whereas information asymmetry is implicit in the activities of public credit registries and private credit bureaus.

The findings with non-overlapping thresholds are broadly consistent with those that are conditional on overlapping thresholds. First, public credit registries have a decreasing effect on the price of loans with the magnitude of reduction comparable across all bank size thresholds. Second, both public credit registries and private credit bureaus enhance the quantity of loans. Third, compared with public credit registries, private credit bureaus have a greater influence in increasing financial access because they have a significantly higher favorable effect on the quantity and price of loans Fourth, the QLH is not apparent because large banks are not associated with lower levels of financial access compared to small banks.

Studies of public credit registries and private credit bureaus in Africa are sparse. This is one of the few to assess linkages between bank size, information asymmetry and financial access.

This is an original piece of research holding the promise to position itself as a pioneering research to showcase the evolving role of Artificial intelligence (AI) in the Indian peer-to-peer lending (P2P) markets. The research effectively uses the holistic multiple case study design to highlight the phenomenon of how AI as the holy grail of investments is proving to be a game changer for the Indian P2P markets.

The study uses a unique research design and curates six Indian licensed Non-Banking Financial Company (NBFC)-P2P as exemplary cases to cull out unique contextual findings on how AI has penetrated the Indian P2P market and road ahead. The research is based on a total of 18 semi-structured interviews of six NBFC-P2P founders and 12 Fintech and P2P industry experts. These interviews were used as alternate sources of evidence for data triangulation along with within case analysis, cross-case analysis to achieve well-rounded results.

The findings have been propounded in the form of unique, context specific results achieved with a bouquet of six NBFC-P2P cases and supplemented through triangulation of data done through multiple industry experts. Findings indicate that AI has reached that tipping point in India.

There is a scope of further refinement of our results with a larger sample size. Therefore future researches could consider conducting a comprehensive study including all existing NBFC-P2Ps in the space.

The research builds perspective for improving the practice in many ways. It shows the way to the other P2Ps still stuck to manual underwriting and see merit in AI-driven processes. It would guide them to embrace new technology driven business models to enhance customer experience and champion service transformation by making financial processes faster and secure. It also highlights how some of the P2Ps are scaling up and improving their visibility and outreach through strategic partnerships.

The research would assist in creating awareness about the unique P2P sector and AI solutions for individual investors, particularly the “new to credit customers” and “thin file borrowers”. AI led initiatives in the P2P space validate a certain amount of sophistication thereby giving sanctity to the sector and would therefore enforce confidence in the minds of new age investors and borrowers.

This original research unravels avenues for novel and untraversed area in the Indian settings where paucity of extant literature and structured data highlighted a research gap and hence necessitated this study. AI as a form of disruptive innovation offering predictive intelligence to the Indian P2P space and empowering it with process efficiency, cost optimization and client engagement is definitely paving the way for an exponential growth in the Indian Fintech Industry.

This study aims to gain insight into the motivations behind the decision to use high-cost payday loans by households who possess mainstream credit and to determine whether this behavior has changed over time.

Using data from Statistics Canada’s Surveys of Financial Security, probit models are used to examine the sociodemographic and financial indicators associated with payday loan use.

The analysis uncovers the sociodemographic and financial characteristics of payday loan-user households with access to lower-cost short-term loans. The findings indicate that the likelihood of payday loan use has risen over time. Additional analysis reveals that indicators of financial instability are positively associated with payday loan use among this group.

This research highlights the dichotomy of payday loan users and recommends policymakers tailor solutions to the specific needs of different types of payday loan users.

This research highlights the distinguishing sociodemographic and financial characteristics of payday loan user households and recommends policymakers tailor solutions to the specific needs of different types of payday loan users.

This is the first study, to our knowledge, to focus analysis on payday loan use of those with access to lower-cost short-term credit alternatives in Canada and to include measures of financial instability in the analysis. This research is timely given the current economic environment of high interest rates and high levels of household debt.