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Welfare Impacts of Micro-Loans in Nigeria
Initial registration date
November 14, 2019
January 10, 2020 2:33 AM EST
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Other Primary Investigator(s)
Additional Trial Information
We are studying the impact of small loans on the welfare of loan applicants. Through a partnership with a financial institution operating in Nigeria, a subset of new loan applicants are randomly assigned to different groups, which creates random variation in the likelihood a borrower is approved for a loan, and the value of the loan they are approved for. Between 4-20 weeks after the initial loan application, a phone survey is conducted with each subject that measures several different aspects of welfare. We are interested in estimating average and heterogeneous treatment effects of these loans.
New loan applicants are randomly assigned to one of 11 different experimental groups, the assignment of which affects the size of the loan they are initially offered. This randomization was already implemented by the partner institution; our RCT studies the impact of this intervention on welfare.
Intervention Start Date
Intervention End Date
Primary Outcomes (end points)
We are mainly interested in the welfare impacts of digital micro-loans. The relevant outcomes of interest are broadly grouped into the following families: (i) resilience, (ii) subjective well-being, (iii) women's economic empowerment, (iv) financial behavior and well-being, and (v) income, expenditures and occupations
Primary Outcomes (explanation)
Secondary Outcomes (end points)
Secondary Outcomes (explanation)
Our partner organization in Nigeria has randomized loan applicants into a number of different treatment groups (irrespective of their credit score), which creates individual variation in the likelihood of loan approval, and also in the loan amount. Our control group comprises a random sample of 'business-as-usual' customers, who might not be able to avail of a loan in the event that their credit score is too 'low'. Between 4-20 weeks after the initial loan application, a phone survey is conducted with around 4,000 individuals (in treatment and control) that measures various aspects of welfare outlined earlier. We exploit the random variation in the likelihood of loan approval, and the random variation in loan amounts disbursed to estimate average and heterogeneous treatment effects (both intent to treat and treatment on treated) on the outcomes of interest.
Experimental Design Details
Randomization done in office via computer
Was the treatment clustered?
Sample size: planned number of clusters
Sample size: planned number of observations
50,000 individuals with admin data, of whom roughly 4,000 will be surveyed
Sample size (or number of clusters) by treatment arms
~15k individuals in treatment 1
~15k individuals in treatment 2
~15k individuals in control
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
INSTITUTIONAL REVIEW BOARDS (IRBs)
Committee for the Protection of Human Subjects, UC Berkeley
IRB Approval Date
IRB Approval Number