Zambia

High Interest Rates and Low Bank Credit to MSMEs in Zambia: Do Switching Costs matter?

Using data collected from a sample of small firms in urban Zambia, this project investigates the existence of switching costs among Micro, Small and Medium Enterprises (MSMEs) when borrowing from commercial banks, and finds no evidence of MSMEs getting ‘locked in’ by their main bank.

Research Note
14 May 2014

Switching costs, Relationship banking and Micro, Small and Medium Enterprises formal bank credit in Zambia

Using data collected from a sample of MSMEs located in urban areas of five major districts in Zambia, this paper investigates the existence and size of switching costs among Micro, Small and Medium Enterprises (MSMEs) when borrowing formal bank credit.

Working Paper
1 Jan 2014

Borrower Switching Behaviour, Market Dominance and Bank Competition of Micro, Small and Medium Enterprises Credit in Zambia

Zambia has been implementing market-based financial sector reforms since 1992, and is currently implementing phase II of its Financial Sector Development Plan. There is some evidence that these reforms have improved the efficiency of bank operations and boosted industrial production. There are still concerns, however, that Micro, Small and Medium Enterprises (MSMEs) have only limited access to bank credit at high cost, and that this has constrained their ability to grow and increase productivity.

Research Project
4 Dec 2012

Borrower Switching Behaviour, Market Dominance and Bank Competition of Micro, Small and Medium Enterprises Credit in Zambia

This project examines potential switching costs for borrowers of formal credit and the impact of these costs on the competitiveness of the lending market.

Research Project
1 May 2012

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