How to reduce microfinance default? The survey says…

Relative to clients who met on a monthly basis during their first loan, those who met weekly are three and a half times less likely to default on their subsequent loan.

Experimental and survey evidence suggests that the decline is driven by improvements in informal risk-sharing that result from more frequent social interaction outside of meetings.

Hm. Familiarity does not breed contempt.

A new paper by Feigenberg, Field and Pande.