The effects of personal characteristics and appearance on the approval of loans in the microfinance industry

• Main Authors: Correa, Paul Aris, Pua, Marc Wesley, Velante, Ven Patrick, Yu, Kenneth Vincent
• Format: text
• Language: English
• Published: Animo Repository 2011
• Subjects: Microfinance > Philippines; Loans, Personal > Philippines; Finance and Financial Management
• Online Access: https://animorepository.dlsu.edu.ph/etd_bachelors/18316
• Institution: De La Salle University

The purpose of this study is to determine the effects of personal characteristics and appearance to the approval rate of loans in the microfinance institutions (MFIs). Also, to known which of these characteristics would yield a higher probability of approval. The study used binary data obtained from surveying both lender and borrowers. Regression is done using logistics model for the lender and probit model for the borrowers. The results of the study showed that the following characteristics have an effect to the approval loans: individuals that have tattoos which can be seen during an interview will less likely be approved for the loan, individuals who are fat or obese has lesser chance of approval compared to a thin and average individuals, and individuals who stands taller than 5 feet 6 inches will likely be approved for their loan.