Religiosity and firms' credit access : empirical evidence from 16 developing countries

Access to credit remains a universal challenge for firms, particularly for small and medium sized enterprises (SMEs). While numerous studies have examined the determinants of credit access, focusing primarily on borrower characteristics, lender policies, and formal institutional factors such as laws and regulations, the role of informal institutional dynamics has often been overlooked. Among these, religiosity remains underexplored. This paper investigates the relationship between religiosity and firms' access to credit using cross sectional data from the 6th wave of the Business Environment and Enterprise Performance Survey (BEEPS VI) and the 7th wave of the World Values Survey (WVS7), covering a sample of firms across 16 countries. The findings reveal a positive relationship between religiosity and credit access, suggesting a potential causal link between the two.