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Journal of Applied Sciences
  Year: 2009 | Volume: 9 | Issue: 11 | Page No.: 2067-2077
DOI: 10.3923/jas.2009.2067.2077
 
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Factors Influencing Participation and Credit Constraints of a Financial Self-Help Group in a Remote Rural Area: The Case of ROSCA and ASCRA in Kemang Village West Java

Lukytawati Anggraeni

Abstract:
This study has investigated characteristics, participation and factors influencing probability of being credit constraint of two types of financial Self-Help Groups (SHG), ROSCA and ASCRA, in Indonesia. Both financial SHG can obtain more information that is only available inside a community to judge member creditworthiness. It is found that some households’ individual characteristics and economic condition influence households’ participation in ROSCA and ASCRA. In particular, being older, working as government employee and having higher education and steady income. Although, social sanction is a useful enforcement tools but it can cause internal credit constraint on socially active households. In ASCRA, households’ health condition and having wedding celebration are good predictors of whether the committee will judge the applicant to be creditworthy. However, there is tendency misuse committee members’ power by giving privileges to family and friends. It is also found that ROSCA reach poorer borrowers than ASCRA.
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How to cite this article:

Lukytawati Anggraeni , 2009. Factors Influencing Participation and Credit Constraints of a Financial Self-Help Group in a Remote Rural Area: The Case of ROSCA and ASCRA in Kemang Village West Java. Journal of Applied Sciences, 9: 2067-2077.

DOI: 10.3923/jas.2009.2067.2077

URL: https://scialert.net/abstract/?doi=jas.2009.2067.2077

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