Jia, XiangpingCull, RobertGuo, PeiMa, Tao2016-06-132016-06-132016-05https://hdl.handle.net/10986/24519Front-line loan officers of microfinance institutions are important in acquiring information on potential borrowers and selecting them in accordance with the microfinance institution's mission. This study uses a unique data set on loan officers and their loan portfolios from China's largest nongovernmental organization microfinance institution to test whether officers' personal characteristics affect the size and quality of their loans. The analysis uses a period in which the institution shifted from reliance on government donations and subsidies to commercial sources of funding. Imposing more commercial incentives on loan officers could affect how they balance potentially competing objectives to serve the poor and pursue profitability. The paper finds that loan officers who were formerly farmers or worked in local government were better able to maintain lending to poorer borrowers, without incurring substantially lower repayment rates on their loans. In short, it appears that the career backgrounds of loan officers did play a role in preventing mission drift.en-USCC BY 3.0 IGOCREDIT PROGRAMBORROWERMICROLOANLIABILITYPUBLIC SECTOR COMMERCIAL BANKSJOINT LIABILITYSTOCKAMOUNT OF LOANSINTERESTDUMMY VARIABLESEXTERNAL FUNDINGRURAL BANKINGINTEREST RATEEXCHANGEFORMAL LOANDEVELOPING COUNTRIESREPAYMENTSPOLITICAL ECONOMYPOSITIVE COEFFICIENTPORTFOLIORURAL CREDITCREDIT COOPERATIVESLOANFINANCIAL STATEMENTCREDITWORTHINESSLOAN AMOUNTBORROWERSGOVERNMENT ASSETSASSET MANAGEMENTLOAN DECISIONSDUMMY VARIABLEINFLATIONINTERNATIONAL BANKSTATE BANKDEVELOPING COUNTRYLENDERMICROFINANCE INSTITUTIONSCENTRAL BANKMATURITYSMALL BUSINESSOVERDUE LOANSFINANCIAL SUSTAINABILITYCREDIT COOPERATIVEGROUP LENDINGLEGAL CONSTRAINTSREPAYMENT INCENTIVESFINANCIAL INSTITUTIONCOMMERCIAL BORROWINGDISBURSEMENTCOMMERCIAL BANKPORTFOLIOSCONTRACTSPOOR BORROWERSINTEREST RATESLENDING DECISIONSFINANCIAL INSTITUTIONSLOCAL GOVERNMENTLOAN REPAYMENTSLOAN MATURITYLENDERSLOANSCREDIT PROGRAMSAGRICULTURAL BANKINVENTORYLOAN SIZESLEGAL FRAMEWORKFINANCEPORTFOLIO QUALITYLOAN TERMSSMALL LOANSINDIVIDUAL LOANIPOTRANSACTIONRURAL FINANCELOAN REPAYMENTREPAYMENT HISTORIESGOODREPAYMENT HISTORYCREDIT PROVIDERSREPAYMENT DIFFICULTIESFUTURECREDIT ACCESSMICRO LOANRETURNSREPAYMENTFINANCIAL PERFORMANCEREPAYMENT RATESDISBURSEMENTSCREDIT HISTORIESINFORMAL PROVIDERSLOAN PORTFOLIOSHARESFACE VALUEBALANCE SHEETTRANSACTION COSTSDEFAULTLOAN QUALITYMARKETCOMMERCIAL BANK LOANPOSTAL SAVINGSLOAN OFFICERMICROCREDITOVERHEAD COSTSMICROFINANCEBANK LOANGOVERNMENT SUBSIDIESLOAN OFFICERSLOAN APPLICATIONSINVESTMENTCOMMERCIAL BANKSSHARECREDIT RATIONINGLOAN PORTFOLIOSCOLLATERALPOVERTYFINANCIAL RISKSGROUP GUARANTEELOAN SIZEREVENUEPROFITFINANCIAL SUPPORTRISK MANAGEMENTCONSUMER PRICE INDEXLENDINGCHECKREPAYMENT PERFORMANCERISK AVERSIONPROFITSOUTSTANDING LOANSLIABILITIESDURABLESGUARANTEESAVINGS BANKDEVELOPMENT BANKINCOME LEVELMICROFINANCE INSTITUTIONMICROENTERPRISESWorking PaperWorld Bank10.1596/1813-9450-7680