THE EFFECTS OF BANKS AND COOPERATIVES TO INDONESIAN HOUSEHOLD WELFARE
Inayati Nuraini Dwiputri, Lustina Fajar Prastiwi, Ilyas

Economics Faculty, Universitas Negeri Malang
Economics and Business Faculty, Halu Oleo University

Abstract

Generally in Indonesia, bank loans have lower interest rate than cooperative loans. Even so the use of cooperative credit in Indonesia is very much, so that the cooperative is considered as one of the supporting economy in Indonesia. This study wants to identify the impact of the use of cooperative credit on community welfare compared to bank loan. This study uses Indonesian Family Life Survey (IFLS) data with a regression analysis of fixed effect methods at the village level. The results showed that the role of cooperative and bank credit did not have a significant difference in improving peoples welfare. This shows that cooperatives have an important role in improving peoples welfare as well as the bank. The higher the amount of credit taken, the more positive the effect is on improving peoples welfare. The use of credit for productive purposes also has a positive influence on improving peoples welfare, compare to consumer credit.

Keywords: credit, interest rate, cooperative, fixed effect

Topic: Economics, Finance, Banking, and Accounting

Link: https://ifory.id/abstract-plain/kyUVGagCXncp

Web Format | Corresponding Author (Inayati Nuraini Dwiputri)