Publication:
Psychometrics as a Tool to Improve Screening and Access to Credit

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dc.contributor.authorArráiz, Irani
dc.contributor.authorStucchi, Rodolfo
dc.contributor.authorBruhn, Miriam
dc.date.accessioned2015-12-18T22:33:42Z
dc.date.available2015-12-18T22:33:42Z
dc.date.issued2015-12
dc.description.abstractThis paper studies the use of psychometric tests, which were designed by the Entrepreneurial Finance Lab as a tool to screen out high credit risk and potentially increase access to credit for small business owners in Peru. The analysis uses administrative data covering the period from June 2011 to April 2014 to compare debt accrual and repayment behavior patterns across entrepreneurs who were offered a loan based on the traditional credit-scoring method versus the Entrepreneurial Finance Lab tool. The paper finds that the psychometric test can lower the risk of the loan portfolio when used as a secondary screening mechanism for already banked entrepreneurs—that is, those with a credit history. For unbanked entrepreneurs—those without a credit history—using the Entrepreneurial Finance Lab tool can increase access to credit without increasing portfolio risk.en
dc.identifierhttp://documents.worldbank.org/curated/en/2015/12/25516966/psychometrics-tool-improve-screening-access-credit
dc.identifier.doi10.1596/1813-9450-7506
dc.identifier.urihttps://hdl.handle.net/10986/23471
dc.languageEnglish
dc.language.isoen_US
dc.publisherWorld Bank, Washington, DC
dc.relation.ispartofseriesPolicy Research Working Paper;No. 7506
dc.rightsCC BY 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo/
dc.subjectBUSINESS OWNERS
dc.subjectCREDIT MARKETS
dc.subjectALTERNATIVE CREDIT
dc.subjectSMALL-BUSINESS LOAN
dc.subjectBARRIERS TO GROWTH
dc.subjectECONOMIC GROWTH
dc.subjectDEPOSITS
dc.subjectPEOPLE
dc.subjectFINANCING
dc.subjectFORMAL FINANCIAL INSTITUTIONS
dc.subjectLOAN PERFORMANCE
dc.subjectINTEREST
dc.subjectCREDIT SCORE
dc.subjectCREDIT AVAILABILITY
dc.subjectBIAS
dc.subjectPRIVATE CREDIT
dc.subjectLACK OF FINANCE
dc.subjectENTREPRENEURS
dc.subjectCAPITAL STRUCTURE
dc.subjectFINANCIAL STATEMENTS
dc.subjectINFORMATION SHARING
dc.subjectCREDIT SCORING
dc.subjectLOAN
dc.subjectASYMMETRIC INFORMATION
dc.subjectPROBABILITY OF DEFAULT
dc.subjectBORROWERS
dc.subjectPAYMENTS
dc.subjectINTERNATIONAL BANK
dc.subjectBUSINESS SUCCESS
dc.subjectCASH FLOWS
dc.subjectINFORMATION ASYMMETRIES
dc.subjectLENDER
dc.subjectBANK COMPETITION
dc.subjectMICROFINANCE INSTITUTIONS
dc.subjectWILLINGNESS TO PAY
dc.subjectPUBLIC CREDIT
dc.subjectSMALL-BUSINESS
dc.subjectSMALL BUSINESS
dc.subjectINTERNATIONAL FINANCE
dc.subjectLOAN APPLICANTS
dc.subjectCREDIT UNIONS
dc.subjectFINANCIAL INSTITUTION
dc.subjectLOAN DEFAULTS
dc.subjectCOMMERCIAL BANK
dc.subjectCONSUMER CREDIT
dc.subjectCREDIT BUREAUS
dc.subjectUNION
dc.subjectFINANCES
dc.subjectLENDING DECISIONS
dc.subjectCREDIT SCORES
dc.subjectPAYMENT
dc.subjectBUSINESS LOAN
dc.subjectFINANCIAL INSTITUTIONS
dc.subjectDEBT
dc.subjectLIMITED ACCESS
dc.subjectLENDERS
dc.subjectGOOD CREDIT
dc.subjectLOANS
dc.subjectENTERPRISES
dc.subjectPROPRIETARY INFORMATION
dc.subjectAPPLICATION PROCESS
dc.subjectFINANCIAL SYSTEM
dc.subjectFINANCE
dc.subjectBANKS
dc.subjectUNIONS
dc.subjectLOAN REPAYMENT
dc.subjectCREDIT DECISIONS
dc.subjectFORMAL FINANCIAL INSTITUTION
dc.subjectFEDERAL RESERVE
dc.subjectCREDIT CONSTRAINTS
dc.subjectCREDIT-SCORING
dc.subjectBUSINESS MANAGEMENT
dc.subjectCAPITAL
dc.subjectFEDERAL RESERVE BANK
dc.subjectCREDIT HISTORY INFORMATION
dc.subjectSMALL ENTERPRISES
dc.subjectBUSINESS CREDIT
dc.subjectFAMILY
dc.subjectACCESS TO FINANCE
dc.subjectGENDER
dc.subjectBANK
dc.subjectCREDIT
dc.subjectWORKING CAPITAL
dc.subjectREPAYMENT
dc.subjectPOTENTIAL LENDERS
dc.subjectCREDIT INFORMATION
dc.subjectCREDIT HISTORIES
dc.subjectPROPERTIES
dc.subjectLOAN PORTFOLIO
dc.subjectCREDIT REPORTING
dc.subjectJOB CREATION
dc.subjectPAYMENT HISTORY
dc.subjectACCESS TO LOANS
dc.subjectASSETS
dc.subjectSMALL BUSINESS OWNERS
dc.subjectDEFAULT
dc.subjectEMPLOYERS
dc.subjectCREDIT BUREAU
dc.subjectMICROCREDIT
dc.subjectPROFITABILITY
dc.subjectCREDIT RISK
dc.subjectACCESS TO CREDIT
dc.subjectMICROFINANCE
dc.subjectECONOMIC DEVELOPMENT
dc.subjectFINANCING OBSTACLES
dc.subjectFUTURE—CASH FLOWS
dc.subjectBANK LOANS
dc.subjectBUSINESS OWNER
dc.subjectSMALL BUSINESS CREDIT
dc.subjectFINANCIAL INTERMEDIATION
dc.subjectID
dc.subjectBANKRUPTCIES
dc.subjectBALANCE SHEETS
dc.subjectCREDIT- SCORING
dc.subjectLOAN SIZE
dc.subjectFINANCE CORPORATION
dc.subjectLARGE FIRMS
dc.subjectNET WORTH
dc.subjectMARITAL STATUS
dc.subjectCOMMERCIAL LENDING
dc.subjectRISK MANAGEMENT
dc.subjectLENDING
dc.subjectCREDIT APPLICANTS
dc.subjectENTREPRENEURIAL FINANCE
dc.subjectENTREPRENEUR
dc.subjectARREARS
dc.subjectCREDIT HISTORY
dc.subjectFINANCIAL CONSTRAINTS
dc.subjectFORMAL CREDIT
dc.subjectSMALL BUSINESSES
dc.subjectCREDIT REGISTRY
dc.subjectCASH FLOW
dc.subjectDEVELOPMENT BANK
dc.subjectCREDIT APPLICATION
dc.subjectEMPLOYEES
dc.titlePsychometrics as a Tool to Improve Screening and Access to Crediten
dc.typeWorking Paperen
dc.typeDocument de travailfr
dc.typeDocumento de trabajoes
dspace.entity.typePublication
okr.crossref.titlePsychometrics as a Tool to Improve Screening and Access to Credit
okr.date.disclosure2015-12-03
okr.date.doiregistration2025-04-10T11:58:55.636841Z
okr.doctypePublications & Research::Policy Research Working Paper
okr.doctypePublications & Research
okr.docurlhttp://documents.worldbank.org/curated/en/2015/12/25516966/psychometrics-tool-improve-screening-access-credit
okr.guid422431468197412707
okr.identifier.doi10.1596/1813-9450-7506
okr.identifier.externaldocumentum090224b083a6a76f_1_0
okr.identifier.internaldocumentum25516966
okr.identifier.reportWPS7506
okr.importedtrue
okr.language.supporteden
okr.pdfurlhttp://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2015/12/03/090224b083a6a76f/1_0/Rendered/PDF/Psychometrics00and0access0to0credit.pdfen
okr.region.countryPeru
okr.topicFinance and Financial Sector Development::Access to Finance
okr.topicFinance and Financial Sector Development::Banks & Banking Reform
okr.topicFinance and Financial Sector Development::Bankruptcy and Resolution of Financial Distress
okr.topicFinance and Financial Sector Development::Microfinance
okr.topicFinance and Financial Sector Development::Debt Markets
okr.unitFinance and Private Sector Development Team, Development Research Group
relation.isAuthorOfPublication471c8982-45ac-42cd-87d0-3e505bd1a972
relation.isAuthorOfPublication.latestForDiscovery471c8982-45ac-42cd-87d0-3e505bd1a972
relation.isSeriesOfPublication26e071dc-b0bf-409c-b982-df2970295c87
relation.isSeriesOfPublication.latestForDiscovery26e071dc-b0bf-409c-b982-df2970295c87
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