Conventional social behaviour amongst microfinance clients
This research considers the role of conventional social behaviour
amongst microfinance clients in terms of influencing groups' success
or failure. Collective credit in question is subject to an adaptation
of the Grameen Bank lending methodology in Mexico. An analysis has
been made on the close interplay between institutional norms, i.e.
repayment conditions imposed by the microfinance institution (MFI),
and emergent cooperation or penalisation strategies that are entirely
handled by clients to meet targets for managing debts and defaulters.
In this case, a sociological and financial fieldwork has been
completed through surveying 600 MFI clients, their 2404 loans, 35
credit officers plus the MFI board of directors. This took place in
the southernmost state of Chiapas, from September 2007 to February
2008, and data analysis was carried out during that period until July
2009. All findings obtained in this process were discussed with
relevant policy makers and this proved key in providing influential
insights that helped improving the regulatory framework of the MFI.
Results from data analysis include the following:
(1) insights backed by up-to-date data that helped to adapt existing
MFI credit policies by taking into consideration the predominant
social norms in successful microcredit groups;
(2) analysed evidence was deemed as reliable by the stakeholders, and
that guided the development of a descriptive model for simulating how
microcredit groups deal with repayments in adversity.
Individual agent decisions and memory properties in the simulation
model are represented descriptively using a matrix data structure,
which contain vectors chronologically organised with outcomes of
endorsed events between members. A reactive model has also been
developed to highlight issues such as sensitivity to initial
conditions and how such such path-dependency can a priori influence
this version of the simulation that updates agent numerical properties
linearly.
