Brief Review of Informal Financial Services Typologies in Zambia: Investing in Sustainable Savings Groups

Informal financial services (IFSs) provide various types of investment avenues for both rural and urban populations in Zambia. This paper is a critical review of the sustainability of various informal investment typologies Zambians has been using and adopting to increase their financial resources and solve their livelihoods and social issues in the process. An evaluation of why people and organizations opt for specific financial services that come in the form of savings and lending groups will be discussed in detail to understand if they have been meeting people's expectations. The paper derives its data from various studies in the past 10 years that emanates from Zambia and Sub-Saharan Africa. While the sustainability of various typologies of informal financial services is broad, they are measured through risks associated, savings policies adopted, group loan guarantees and flexibility, interest and transactional expenses enforcement, income-generating, wealth creation and any social capital investment. The research reveals that limited studies have looked at various typologies of savings and lending groups, including evaluating their sustainability. This study helps in decision making for anyone or organization who would want to join or start a savings group in Zambia and key parameters to follow.

Homophily and peer influence in early-stage new venture informal investment

Conceptualising early-stage new venture informal investors as co-entrepreneurs whose actions are socially embedded, we examine the role of social influence and how it interplays with entrepreneurial experience at the individual level leading to informal investment. We extend theories of social homophily and social influence to argue that informal investment decisions are influenced by shared experience and entrepreneurism in peer groups. We test our hypotheses with a multi-level model using first a large cross-country dataset and next in depth within a country. Our analysis reveals that both individual entrepreneurship experience and peer group-embedded experience significantly influence the likelihood that an individual becomes an early-stage investor. Furthermore, these social effects substitute for the lack of individual entrepreneurial experience.

The impact of media on entrepreneurship participation: a cross-country panel data analysis

Purpose Unlike the previous studies that examined the direct relationship between media attention on entrepreneurship (MAE) and entrepreneurship participation, this paper aims to examine the mediated link through entrepreneurial intention. Design/methodology/approach The cognitive theory of media provides the foundation for predictions that primary outcome of MAE is the entrepreneurial intention which in turn affects the different types of entrepreneurship participation (early-stage startup activities, new product development [NPD] activities and informal investment activities). The test of the hypothesized model relies on panel data for 2010–2015 on 40 developing and developed countries taken from the Global Entrepreneurship Monitor report of 2015. Findings MAE has an indirect effect on two types of entrepreneurship participation (early-stage startup activities and informal investment activities) via entrepreneurial intention, whereas there is no direct or indirect effect of MAE on NPD activities. The findings also suggest when the entrepreneurial intention is added as a mediator in the model; the direct effect of MAE on early-stage entrepreneurial activities becomes insignificant. Originality/value To the best of the authors’ knowledge, this is the first study in its nature which established the relationship between MAE and entrepreneurial intention. In addition, this study also explained the mediation mechanism between the relationship of MAE and entrepreneurship participation by using the panel data.

Influencing Factors of the Informal Investment in Central Europe

This paper examines the influencing factors of becoming informal investors in two groups of Central European countries: the innovation-driven (Estonia, Latvia, Slovenia and Slovakia) and efficiency-driven economies (Croatia, Hungary, Lithuania, Poland and Romania), based on the GEM (Global Entrepreneurship Monitor) database from 2014. According to the results, in the studied innovation-driven economies of Central Europe the probability of becoming an informal investor is higher for those, who know other entrepreneurs, who are confident in their own entrepreneurial skills, who are in the higher percentile of the household income, who are older and male. The results also suggest that in the studied efficiency-driven economies of Central Europe the probability of becoming an informal investor is higher for those who are confident in the own entrepreneurial skills, who know other entrepreneurs, who are in the higher percentile of the household income, who are older and male. The probability is decreased, if somebody is employed full-time. The study emphasises similarities instead of differences regarding the analysed aspect between the two groups of countries.

Informal Investment for Entrepreneurs in Latin America and the Caribbean

The authors provide a broad view of the field of informal investment in the region, emphasizing the importance of separating the contribution of this sector from that provided by other channels of financing of entrepreneurship such as angel investment and venture capital. After framing the issue and reviewing the most relevant academic literature, the authors discuss the existing relationship between the current state of informal investment in the area and the size of the informal sector in economies that constitute the sector. They also show the magnitude of informal investment and its impact on the creation of new business activities, identifying the most salient features of the process, as well as their strong and weak points, and a deep reflection on the elements that would have to work to make progress in the modernization of this sector.

INFORMAL INVESTORS IN CHILE: AN EXPLORATORY STUDY FROM A GENDER PERSPECTIVE / NEFORMALIŲ INVESTUOTOJŲ (PAGAL LYTĮ) TYRIMAS ČILĖJE

Informal investment represents one of the main sources to finance early-stage new ventures. Despite the progressive participation of women in informal investment, little is known about the characteristics of female informal investors, especially in developing countries. This study examines the gender differences of a sample of 613 informal investors in Chile. To this end we used the database from the Global Entrepreneurship Monitor Chile 2007–2008 and applied tests of differences in proportions and means for independent samples. The results show that there are significant gender differences in some socio-demographic variables, like education and work status, and also in the perception of good opportunities and the fear to failure. Additionally, women invest smaller amounts and expect lower returns than men do. Finally, women invest more than men in close family. Policy implications of these results are discussed. Santrauka Neformalios investicijos – vienas pagrindinių šaltinių, iš kurių finansuojamos naujai besikuriančios arba tik pradėjusios savo veiklą įmonės. Nepaisant to, kad neformalioje investicijų veikloje palaipsniui daugėja moterų, gana mažai žinoma apie jas kaip neformalias investuotojas, ypač besivystančiose šalyse. Autoriai atliko tyrimą Čilėje, kuriame dalyvavo 613 skirtingų lyčių investuotojų, kurie buvo paimti iš duomenų bazės „Global Entrepreneurship Monitor Chile 2007–2008 m“. Autorių atliktų tyrimų rezultatai rodo, kad vis dėlto kai kuriuose socialiniuose demografiniuose kintamuosiuose esama reikšmingų lyčių skirtumų, pavyzdžiui, išsilavinimas ir užimamos pareigos, perspektyvų darbovietėje suvokimas, karjera ir nesėkmės baimė. Atlikę tyrimą autoriai nustatė, kad moterys labiau linkusios investuoti mažesnes sumas nei vyrai.