The significance of socioeconomic factors on personal loan decision a study of consumer banking local private banks in Pakistan

Azam, Rehan and Muhammad, Danish and Syed Akbar, Suleman (2012): The significance of socioeconomic factors on personal loan decision a study of consumer banking local private banks in Pakistan.

Abstract

This paper explores the influences of the approved results of loans cases, the loan applicants’ socioeconomic attributes in the decision of perusal loan. The results can improve the credit quality and avoid the misjudgment of screening personal loan customers and also establish a better personal loan risk management forecasting model. The main purpose of the present paper was to evaluate significance of loan applicant socioeconomic attributes on personal loan decision in the local private commercial banks of Pakistan. The statistical techniques, descriptive and logistic regression were used. The model identified that out of six independent variables, region, residence status and year with the current organization have significant impact on personal loan decision.

• Item Type: MPRA Paper
• Language: English
• Keywords: personal loan; socioeconomic; consumer banking; logistic regression model
• Subjects: H - Public Economics > H8 - Miscellaneous Issues; L - Industrial Organization > L8 - Industry Studies: Services > L84 - Personal, Professional, and Business Services; K - Law and Economics > K3 - Other Substantive Areas of Law > K35 - Personal Bankruptcy Law; D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D81 - Criteria for Decision-Making under Risk and Uncertainty; G - Financial Economics > G2 - Financial Institutions and Services > G23 - Non-bank Financial Institutions ; Financial Instruments ; Institutional Investors; H - Public Economics > H2 - Taxation, Subsidies, and Revenue > H24 - Personal Income and Other Nonbusiness Taxes and Subsidies; D - Microeconomics > D1 - Household Behavior and Family Economics > D14 - Household Saving; Personal Finance; I - Health, Education, and Welfare > I2 - Education and Research Institutions > I22 - Educational Finance ; Financial Aid; D - Microeconomics > D7 - Analysis of Collective Decision-Making > D71 - Social Choice ; Clubs ; Committees ; Associations; D - Microeconomics > D3 - Distribution > D31 - Personal Income, Wealth, and Their Distributions; G - Financial Economics > G2 - Financial Institutions and Services; A - General Economics and Teaching > A1 - General Economics > A13 - Relation of Economics to Social Values; H - Public Economics > H8 - Miscellaneous Issues > H81 - Governmental Loans ; Loan Guarantees ; Credits ; Grants ; Bailouts; G - Financial Economics > G3 - Corporate Finance and Governance > G32 - Financing Policy ; Financial Risk and Risk Management ; Capital and Ownership Structure ; Value of Firms ; Goodwill; K - Law and Economics > K3 - Other Substantive Areas of Law > K36 - Family and Personal Law; G - Financial Economics > G2 - Financial Institutions and Services > G21 - Banks ; Depository Institutions ; Micro Finance Institutions ; Mortgages

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