@techreport{77cdcc51670c43398a45f31240da89e5,
title = "E-Payment Technology and Business Finance: A Randomized Controlled Trial with Mobile Money",
abstract = "We conducted a randomized controlled trial with small and medium-sized enterprises in Kenya to estimate the causal impact of an e-payment technology on business finance. Using an encouragement design, we exogenously increased e-payment usage among a random subset of firms by relaxing adoption transaction costs and information barriers. Sixteen months after the intervention, we find that the e-payment technology increased access to mobile loans (in number of loans, as well as in the amount borrowed) by at least 50% (0.17 sd), likely due to the reduction of information asymmetries brought by an increase in digital transactions. We find no effect of the e-payment technology on sales and profits, but we do find a reduction of sales volatility and precautionary investment, especially for smaller firms. This suggests that mobile loans help smaller firms cope with short-term negative shocks. We provide a stylized model of business finance that rationalizes these findings.",
author = "P. Dalton and H. Pamuk and R. Ramrattan and {van Soest}, D. and B. Uras",
year = "2022",
language = "English",
series = "CentER Discussion Paper",
publisher = "Tilburg University",
number = "2022-031",
type = "WorkingPaper",
institution = "Tilburg University",
}