Interest rate and default risk in Mexican rural financing
DOI:
https://doi.org/10.29312/remexca.v17i5.4141Keywords:
borrower segmentation, credit exclusion, institutional filters, marginal effects, predicted probabilityAbstract
The study aimed to analyze the structural factors that limit access to rural credit in Mexico to show how interest rates, climate risks, document formalization, and territorial location operate as institutional filters of financial exclusion. To this end, a binary logistic model was applied to a national database of 250 observations, compiled from administrative records and secondary data from 2023, including variables that identify exclusion patterns not attributable to the borrower’s productive performance. The model was statistically significant and had robust explanatory power for default on rural loans. The quantitative results show that the interest rate is the factor with the greatest impact: for each additional percentage point in the rate, the probability of default increases by 21.5 percentage points. A change in climate risk category, such as going from frost to pest raises this probability by 2.23%. In addition, each additional month in the term reduces risk by 2.01%, suggesting a differentiated allocation based on the solvency profile. These findings allow us to conclude that the interest rate does not reflect the producer’s productivity but rather the system’s structural fragility, acting as the main driver of exclusion and that, in the rural financing system, there is a rigid architecture that penalizes structural risk without offering adaptation mechanisms for vulnerable producers.
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