The Impact of Credit Information Sharing Reforms on Firm Financing?

This paper analyzes the impact of introducing credit information-sharing systems on firms' access to finance. The analysis uses multi-year, firm-level surveys for 63 countries covering more than 75,000 firms over the period 2002-13. The results reveal that credit bureau reforms, but not credit registry reforms, have a significant and robust effect on firm financing. After the introduction of a credit bureau, the likelihood that a firm has access to finance increases, interest rates drop, maturity lengthens, and the share of working capital financed by banks increases. The effects of credit bureau reforms are more pronounced the greater the coverage of the credit bureau and the scope and accessibility of the credit information-sharing scheme. Credit bureau reforms also have a greater impact on firms' access to finance in countries where contract enforcement is weaker. Finally, there is some evidence that the effects of credit bureau reform are more pronounced for smaller, less experienced, and more opaque firms.

Bibliographic Details

Main Authors:	Martinez Peria, Maria Soledad, Singh, Sandeep
Format:	Policy Research Working Paper biblioteca
Language:	English en_US
Published:	World Bank Group, Washington, DC 2014-08
Subjects:	ACCESS TO BANK, ACCESS TO CREDIT, ACCESS TO FINANCE, ACCESSIBILITY, ACCOUNTS RECEIVABLE, ADVERSE SELECTION, ASSET FINANCING, ASYMMETRIC INFORMATION, BALANCE SHEET, BANK FINANCING, BANK LENDING, BANK POLICY, BANK SUPERVISION, BANKRUPTCIES, BANKS, BINDING CONSTRAINT, BORROWER, CASH FLOW, CENTRAL BANKS, CHECKS, COLLATERAL, COLLECTION SERVICES, COMMERCIAL LENDERS, CONTRACT ENFORCEMENT, CONTRACT LAWS, COST OF CREDIT, COUNTRY RISK, CREDIT BUREAU, CREDIT BUREAUS, CREDIT CONSTRAINT, CREDIT CONSTRAINTS, CREDIT FACILITIES, CREDIT INFORMATION, CREDIT INFORMATION SYSTEMS, CREDIT MARKET, CREDIT MARKETS, CREDIT QUALITY, CREDIT RATIONING, CREDIT REGISTRIES, CREDIT REGISTRY, CREDIT REPORTING, CREDIT REPORTING SYSTEMS, CREDIT SCORES, CREDIT WORTHINESS, DEBT, DEFAULT INFORMATION, DEFAULT RATES, DEFAULTS, DEMAND FOR CREDIT, DEPENDENT, DEPOSIT, DEVELOPING COUNTRIES, DOMESTIC CREDIT, DUMMY VARIABLE, DUMMY VARIABLES, ECONOMIC DEVELOPMENT, ECONOMICS, EQUITY MARKETS, EXCLUSION, EXPORTER, EXPORTERS, EXTERNAL FINANCE, FINANCIAL CONSTRAINT, FINANCIAL CONSTRAINTS, FINANCIAL INSTITUTION, FINANCIAL INSTITUTIONS, FINANCIAL INTERMEDIATION, FINANCIAL REFORM, FINANCIAL REFORMS, FINANCIAL SECTOR DEVELOPMENT, FINANCIAL STATEMENT, FINANCIAL STUDIES, FINANCIAL SYSTEM, FINANCING CONSTRAINT, FINANCING CONSTRAINTS, FIRM FINANCING, FIXED ASSET, FIXED ASSETS, INDEBTEDNESS, INFLATION, INFLATION RATE, INFORMATION REQUIREMENTS, INFORMATION SHARING, INFORMATIONAL ASYMMETRIES, INFORMATIONAL ASYMMETRY, INSTITUTIONAL ENVIRONMENT, INSTRUMENT, INTANGIBLE, INTANGIBLE ASSETS, INTEREST RATE, INTEREST RATES, INTERNATIONAL BANK, INTERNATIONAL STANDARD, INVENTORY, INVESTMENT DECISIONS, LARGE FIRMS, LATE PAYMENTS, LEGAL SYSTEM, LENDER, LENDERS, LENDING DECISIONS, LEVELS OF ACCESS, LEVERAGE, LINE OF CREDIT, LOAN, LOAN AMOUNTS, LOAN MATURITIES, LOAN MATURITY, LOAN PERFORMANCE, MARKET EQUILIBRIUM, MARKET INFORMATION, MATURITY, MEDIAN FIRM, MICROFINANCE, MONETARY FUND, MONETARY VALUE, MORAL HAZARD, OUTSTANDING LOAN, OUTSTANDING LOAN AMOUNTS, OVERDRAFT, OVERDRAFT FACILITY, OVERDRAFT PROTECTION, PAYMENT HISTORY, PERSONAL ASSETS, POLITICAL ECONOMY, PRIVATE CREDIT, PRIVATE CREDIT BUREAU, PUBLIC CREDIT, PUBLIC INFORMATION, REGISTRY DATA, REGISTRY REFORM, REGISTRY REFORMS, REPAYMENTS, RISK PREMIUMS, SMALL LOANS, TOTAL DEBT, TRANSITION COUNTRIES, TRANSPARENCY, UNION, VALUE OF COLLATERAL, WORKING CAPITAL,
Online Access:	http://documents.worldbank.org/curated/en/2014/08/20141619/impact-credit-information-sharing-reforms-firm-financing http://hdl.handle.net/10986/20348
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