Do Foreign Banks in India Indulge in Cream Skimming?

Published By: Centre for International Trade and Development - J | Published Date: January, 01 , 2014

Foreign banks in developing countries are often found to indulge in cream skimming, a lending strategy that targets only wealthy segments of the credit market and exclude small and marginal borrowers from the general pool of borrowers. This paper attempts to investigate whether lending pattern of foreign banks in urban regions of Indian States is indicative of cream skimming. Using credit data on urban regions of 21 States of India for the period 1999-2011, this paper finds empirical evidence of cream skimming by foreign banks in India.

Author(s): Mandira Sarma, Anjali Prashad | Posted on: Mar 16, 2016 | Views() | Download (180)

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