Impact of a Partial Portfolio Credit Guarantee for Women-Owned Firms on Credit Supply and Access to Credit in Burkina Faso

Last registered on September 14, 2021
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Pre-Trial

Trial Information

General Information

Title
Impact of a Partial Portfolio Credit Guarantee for Women-Owned Firms on Credit Supply and Access to Credit in Burkina Faso
RCT ID
AEARCTR-0008224
Initial registration date
September 13, 2021
Last updated
September 14, 2021, 4:11 PM EDT

Locations

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Primary Investigator

Name
Andrew Brudevold-Newman
Affiliation
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Other Primary Investigator(s)

PI Name
Diego Ubfal
PI Affiliation
World Bank
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Additional Trial Information

Status
In development
Start date
2021-08-16
End date
2026-09-15
Keywords
Finance & Microfinance, Firms & Productivity, Gender
Additional Keywords
JEL code(s)
O12, O17
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Abstract
Differential access to credit is one of the key drivers of the large and persistent profit gap between women- and men-owned firms. Credit guarantee schemes are a common and promising policy tool to increase credit to targeted sectors but their impact on financial institution lending and firm access to credit remains understudied, particularly in Sub-Saharan Africa. This study will evaluate the impact of a partial portfolio credit guarantee for women-owned firms on credit supply and access to credit in Burkina Faso. Our evaluation will randomly assign independent financial institutions operating under a common credit federation into either a treatment group whose eligible targeted-sector loans will be covered by the guarantee or to a control group whose eligible targeted-sector loans will not be covered by the guarantee. We will measure the impact of access to the guarantee using administrative credit union data by comparing the loan portfolio and lending decisions of the treatment credit unions to the control credit unions. We will supplement our credit union-level analysis with a panel survey of women-owned firms operating in the catchment areas of the credit unions to measure the impact of the program on firm-level outcomes including access to credit, profits, and innovation.
External Link(s)

Registration Citation

Citation
Brudevold-Newman, Andrew and Diego Ubfal. 2021. "Impact of a Partial Portfolio Credit Guarantee for Women-Owned Firms on Credit Supply and Access to Credit in Burkina Faso ." AEA RCT Registry. September 14. https://doi.org/10.1257/rct.8224-1.0
Sponsors & Partners
Experimental Details

Interventions

Intervention(s)
The intervention to be evaluated is a partial portfolio credit guarantee of financial institution (FIs) lending to three specific segments---SMEs, women entrepreneurs, and farmers. The partial guarantee applies to all eligible loans in each of the segments within the FI’s portfolio. Under the scheme, the government will provide 50 percent of the regulator-required collateral for all bank loans to SMEs, and 70 percent for all loans to women entrepreneurs and farmers.
Intervention Start Date
2021-09-15
Intervention End Date
2024-10-31

Primary Outcomes

Primary Outcomes (end points)
This evaluation will measure the impact of the PPCG on lending to the targeted sectors and subsequent down-stream firm performance. Specifically, on the financial institution side, we will measure the impact of credit union access to the PPCG on the volume, quantity, and quality of lending to the targeted sectors. On the firm side, we will measure the impact of the guarantee on access to credit and firm performance including surivival, profits, revenues, investments and innovation.
Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
Our experimental design will randomly assign 11 of 21 quasi-independent credit unions to receive full access to the partial portfolio credit guarantee, with the remaining 10 serving as a control group. All loans made to targeted-sector eligible applicants from the treatment credit unions will be covered by the credit guarantee. There are three targeted sectors: agricultural, women-owned MSMEs and men-owned MSMEs. The control group credit unions will receive access to the guarantee for only the agricultural sector, while the treatment group credit unions will receive access to the guarantee for all three sectos.

Our firm-level analysis relies on a cluster-randomized controlled trial approach, comparing targeted-sector firms near the treatment credit unions to targeted-sector firms near the control credit unions. Through a firm census, we plan to enroll 50 firms, stratified by guarantee-eligibility, in the catchment area of each of the credit unions.
Experimental Design Details
Not available
Randomization Method
Randomization done in office on a computer.
Randomization Unit
Credit unions were matched on pre-program lending characteristics and randomized within pairs.
Was the treatment clustered?
Yes

Experiment Characteristics

Sample size: planned number of clusters
21 credit unions.
Sample size: planned number of observations
1050 guarantee-eligible women-owned firms
Sample size (or number of clusters) by treatment arms
550 firms near the the 11 treatment financial institutions and 500 firms near the 10 control financial institutions.
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
Supporting Documents and Materials
IRB

Institutional Review Boards (IRBs)

IRB Name
Health Media Lab
IRB Approval Date
2020-09-02
IRB Approval Number
765WBG20
Analysis Plan