Does gender matter in the South African home loan market?

Abstract

South Africa is patriarchal and men have a big financial responsibility towards providing for their families, especially food and shelter. This paper explores the difference in credit risk between men and women in the South African home loan market is to understand if gender impacts on the riskiness of retail home loan credit in the South African market. Many studies have indicated that women have a better repayment ability than men and pose lower credit risks than their male counterparts (Marrez & Schmit, 2009). Using an Economic approach, this research analyses whether gender impacts on the home loan account status. It considers the PD, LGD and EAD by gender. This research goes further by examining the variables significant in predicting account status, as well as gender’s influence on these variables.