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Small Business Economics

Erschienen in:

01.02.2015

The role of demographics in small business loan pricing

verfasst von: Doris Neuberger, Solvig Räthke-Döppner

Erschienen in: Small Business Economics | Ausgabe 2/2015

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Abstract

Demographic change influences the structure of the entrepreneurially active population, which may affect credit risk and financing conditions of small firms. Using bank internal data of small business loans in Germany, we find that the lending relationship plays a larger role for loan prices than demographics. Loan rates decrease with soft information gained through longer loan processing time and a larger number of accounts at the same bank. They increase with hard information about repayment arrears and reminders. Late payments have the largest influence on loan prices. Older entrepreneurs do not seem to be discriminated. Rather, the younger have to pay more because their loans and businesses are smaller and they lack liquidity to pay in time. Marital status and population density of the business district do not matter. This is good news for aging economies with a rising share of elderly and singles and growing disparities between peripheral and agglomerated regions.

Vorheriger Artikel Leverage and firm performance of small businesses: evidence from Japan

Nächster Artikel Productivity, outsourcing and exit: the case of Australian manufacturing

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We do not review the literature on the role of ethnicity and gender in small business loan pricing, because it is not related to our own research.

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Titel: The role of demographics in small business loan pricing
verfasst von: Doris Neuberger
Solvig Räthke-Döppner
Publikationsdatum: 01.02.2015
Verlag: Springer US
Erschienen in: Small Business Economics / Ausgabe 2/2015
Print ISSN: 0921-898X
Elektronische ISSN: 1573-0913
DOI: https://doi.org/10.1007/s11187-014-9602-4

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