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

From:: Department for International Development
Published: 1 January 2014

Country:: Zambia
Document Type:: Briefing
Theme:: Economic Growth
Authors:: Banda, B., Mphuka, C., Simumba, J.

Abstract

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.

Citation

Mphuka, C.; Simumba, J.; Banda, B. PEDL Research Note. High Interest Rates and Low Bank Credit to MSMEs in Zambia: Do Switching Costs matter? Centre for Economic Policy Research (CEPR), (2014) 3 pp.