Journal of Alternative Finance

Does good governance enhance the subsidies embedded in soft loans received by microfinance organizations? - A new publication answers this question: "Ethical Funding and Good Governance: Does the Design of Funding Matter?" by Marek Hudon from Solvay Brussels School of Economics and Management (Belgium), Samuel Anokye Nyarko from MBS School of Business (France), and Ariane Szafarz from Solvay Brussels School of Economics and Management (Belgium). Purpose: This paper examines the relationship between corporate governance and subsidies received by hybrid organizations. It is hypothesized that good governance enhances the subsidies embedded in soft loans because lenders are incentivized to care about governance and want their capital back. Conversely, it is hypothesized that there is no correlation between governance factors and grants, as grant providers mainly prioritize the social mission.  Study design: To assess our theoretical predictions, we use audited data about 250 microfinance organizations operating in the global South. First, an exploratory analysis identifies the five main factors of effective corporate governance. Second, we estimate a fixed-effect generalized least squares model and test whether these five factors affect the subsidies received by the organizations.  Findings: The results confirm that soft loans are positively correlated with good governance, while grants are not.  Contributions: Grant and soft loan providers exhibit different levels of appreciation for corporate governance, possibly based on mission segmentation. These findings demonstrate that charitable funders of hybrid organizations have developed a distinct approach to managing the unique challenges posed by the double bottom line of these entities.  Implications: Microfinance managers should align their corporate governance systems with their specific financing needs to optimize their access to different forms of subsidies. * The paper is part of an upcoming special issue on Microfinance Research guest edited by Roy Mersland from Handelshøyskolen ved UiA / School of Business and Law, University of Agder (Norway) and Øystein Strøm from OsloMet – Oslo Metropolitan University (Norway). #microfinance #MFI #corporategovernance #grants #softloans https://lnkd.in/d3j9cXvg

The Journal of Alternative Finance now officially recognized in Finland while debuting on the the Finnish journal ranking system JUFO, which is published by the Federation of Finnish Learned Societies at level 1. Nice entry for our fast growing journal! https://lnkd.in/dSYeQy69

New paper accepted and published: "Optimal REIT Portfolio Selection Using Machine Learning" By Wendi Zhang, Bin Li, Tarlok Singh, Alan Wee-Chung Liew, and Eduardo Roca all from Griffith University (Australia) This study examines whether machine learning approaches can effectively solve the portfolio selection and optimization problems related to Real Estate Investment Trusts (REITs)-mixed portfolios. It also investigates the impact of different proportions of Equity-REIT (EREIT) and Mortgage-REIT (MREIT) on portfolio returns. This research collects daily data from 157 EREITs and MREITs, totaling 1,283,800 observations, and construct 126 portfolios in the U.S. market, covering the period from January 1, 2000, to July 31, 2022. Using a genetic algorithm (GA), we optimize REITs combined with stocks, bonds, and gold, and compare GA’s performance with the classical mean-variance (MV) method. To assess robustness, authors also perform sub-period testing to examine portfolio performance under adverse economic conditions. The results show that the GA outperforms the MV method in optimizing REIT-mixed portfolios, especially during periods such as the pre-Global Financial Crisis (GFC) and COVID-19. Portfolios with higher allocations to REITs exhibit superior returns, with EREIT outperforming MREIT in enhancing returns and controlling risk. #REITs #RealEstateInvestmentTrusts #protfoliooptimization #machinelearning #MortgageREIT #EquityREIT #realestateinvestment #realestatefinance For more information see: https://lnkd.in/dwDc8cVe

New paper accepted and published: "From Intent to Inaction: Factors Conditioning Cultural Institutions From Embracing Crowdfunding as a Fundraising Tool" By Dr. Anders Rykkja from Queen's University Belfast (UK) and Prof. Lluís Bonet from Universitat de Barcelona (Spain) Purpose:  The article explores factors explaining cultural institutions’ intentions to adopt and circumstances that lead to inaction in terms of launching a crowdfunding campaign. Study Design:  The study is a single-case study of a Norwegian museum consortium. It combines thematic analysis of qualitative data from interviews and non-parametric tests of quantitative survey data to examine differences between four categories of employees: leadership, curators, technical staff, and support staff. Findings:  The study identifies three key factors contributing to the inaction and failure to launch the crowdfunding campaign: (1) the added value of funding and non-monetary benefits; (2) legitimacy concerns surrounding crowdfunding; and (3) the leadership and management of implementing what proved to be a non-routine activity. Contributions:  The paper provides insights into the drivers and barriers that influence the intention to use institutional cultural crowdfunding. It adds to the literature by demonstrating that cultural institutions’ internal organisational dynamics influence decision-making. The derived propositions provide a basis for further empirical research into how cultural institutions approach crowdfunding. Implications:  The findings hold practical implications for cultural institutions, policymakers, and scholars. They underscore the importance of leadership in navigating legitimacy concerns, fostering intra-organisational collaboration, and supporting institutional cultural crowdfunding efforts from intent to action. #crowdfunding #culture #art #artsfunding #culturalfunding #museum #casestudy #culturalinstitution #alternativefinance https://lnkd.in/ggN4iZKA

The first paper for 2025 is now accepted and published: "Beauty Contest in Equity-Based Crowdfunding Campaigns" by Artur A. Trzebiński, Ph.D. from Wroclaw University of Economics and Business and Łukasz Kołodziejczyk from SGH Warsaw School of Economics Purpose This study investigates how investor sentiment influences equity-based crowdfunding campaigns outcomes, with a particular focus on sentiment related to specific industries. The motivation stems from the need to understand the behavioural drivers behind crowdfunding outcomes, especially in a context where both private and public funding coexist. Study Design We employed a machine learning approach, utilizing the PolBERT model to analyse investor sentiment from online forum discussions in Poland. The data consisted of sentiment expressed across various industry-specific discussions, which were analysed to assess their impact on crowdfunding campaign outcomes. Findings The study reveals that while positive investor industry sentiment enhances the capital raised for IPO-targeted companies, it negatively affects overall campaign success and the number of investors, particularly in non-IPO-targeted firms. These findings suggest a complex relationship between sentiment and campaign outcomes, where higher sentiment can sometimes deter participation in certain cases. Contributions This research introduces a novel category of behavioural success drivers in the context of equity crowdfunding, proposing a new classification of meta-drivers of crowdfunding success. Methodologically, the study demonstrates the efficacy of fine-tuned BERT-class models in processing language, offering new insights into the investor sentiment analysis. Implications The results have significant implications for both researchers and practitioners. For researchers, the study expands the understanding of behavioural finance in crowdfunding, while for practitioners, it provides strategic insights into how investor sentiment can influence campaign timing, structure, and expectations. The findings also offer value for policymakers by shedding light on investor behaviour in equity-based crowdfunding markets. #crowdfunding #equitycrowdfunding #alternativefinance #crowdinvesting #Poland #investorsentiment #sentimentanalysis https://lnkd.in/dsrRZPvN

New paper published and available for free download: "Mindful Wealth Management: Thematic Integration and Analysis of Mindfulness in Financial Decision-Making" By Askar Garad from Universitas Muhammadiyah Yogyakarta, Indonesia Purpose: This paper explores the influence of mindfulness on financial decision-making, aiming to develop a comprehensive framework that integrates psychological and behavioral finance perspectives. It addresses gaps in current literature, including the limited exploration of personality traits like openness and conscientiousness and the role of mindfulness across generations.  Study Design: The research employs a conceptual analysis based on a comprehensive literature review, synthesizing insights from psychology, finance, and neurobiology. The study also examines the intersection of mindfulness and emerging financial technologies such as robo-advisors and cryptocurrencies.  Findings: The study identifies how mindfulness influences financial behaviors, particularly in risk aversion, cognitive flexibility, and emotional regulation. It highlights generational differences in financial decision-making and mindfulness’s role in navigating digital financial environments.  Contributions: This paper introduces a revised conceptual framework that expands the understanding of mindfulness in financial decision-making. It includes new dimensions, such as personality traits, generational differences, and the interaction between mindfulness and digital finance.  Implications: The findings provide actionable insights for financial advisors, practitioners, and policymakers. Recommendations include the integration of mindfulness-based strategies tailored to individual traits and generational needs, as well as mindfulness training in leadership development programs to foster ethical and resilient decision-making. #mindfulness #mindfulfinance #digitalfinance #financildecisionmaking https://lnkd.in/dsBZJXdp

New paper accepted and now available for free download: "Does Digitization Affect Social and Financial Performance in Microfinance Institutions?" By Deborah Umba, Mélanie Croquet, and Cécile Godfroid from University of Mons UMONS, Belgium This research aims to explore the effects of the digitization of microfinance institutions (MFIs) on their social and financial performances, and on the trade-off between them given the double mission pursued by these institutions. To reach this objective, we performed ordinary least squares (OLS), logit, and two-stage least squares (2SLS) regressions on a sample of 331 microfinance institutions from the ATLAS database. Findings reveal evidence of significant mixed effects of digitization on social and financial performance indicators. They also show that there is no significant effect of digitization on trade-offs. #microfinance #digitization #digitalization #altermativefinance #performance https://lnkd.in/dPZSNYSW

New paper accepted and now available for free download: "Trust in Government, Electronic Taxation, and the Adoption of Fintech" By Prince Baah-Peprah (Handelshøyskolen ved UiA / School of Business and Law, University of Agder, Norway); Samuel Anokye Nyarko (MBS School of Business, France); Bjorn-Tore Flaten (Handelshøyskolen ved UiA / School of Business and Law, University of Agder); FELICIA NAATU (PhD) (Simon Diedong Dombo University of Business and Integrated Development Studies (SDD UBIDS), Ghana); and Priscilla Serwaah (Aarhus University, Denmark) Mobile money (MoMo) services have become an integral part of the banking system in developing countries. Research is needed to understand the implications of taxing this financial technology sector and inform public policy. The current MoMo tax literature is limited by its focus on personal factors while neglecting institutional factors. The present study develops an integrated model of individuals’ attitudes toward MoMo tax payments and their intentions to use MoMo services while paying related MoMo taxes. To test the model, we analyze survey data collected from 892 participants across 16 regions of Ghana using structural equation modeling. Our findings indicate that perceived trust in government and perceived tax burden are significant determinants of attitudes toward MoMo tax payment, while perceived tax burden is influenced by perceived trust in government. Similarly, perceived tax burden mediates the effect of perceived trust in government on attitudes toward MoMo tax payments. Furthermore, the perceived usefulness of MoMo services is determined by perceived ease of use of MoMo services, whereas MoMo services use/tax payment intentions are determined by perceived trust in government, attitudes toward MoMo tax payments, and perceived usefulness of MoMo services. Finally, perceived usefulness of MoMo services mediates the effects of perceived ease of use on MoMo services and MoMo service use/tax payment intentions. We discuss explanations for these findings and provide practical, theoretical, and research implications. #MoMo #Mobilemoney #FinTech #Ghana #WestAfrica #mobilemoneyservice #mobilemoneytax #taxburdeb #financialinclusion #taxpayment #trustingovernment #trust https://lnkd.in/dvyiJERS

Top rated submissions to this conference will be invited to a fast-track submission to our journal. See you in Kristiansand, Norway in June 2025!

*** ICAFR 2025: SAVE THE DATE & CALL FOR PAPERS *** First call for papers for the 4th ICAFR (International Conference on Alternative Finance Research) to be held in Aalborg, Denmark 02-04 June 2025. The conference is hosted by Aalborg University, and organized by the UiA Crowdfunding Research Center at the Handelshøyskolen ved UiA / School of Business and Law, University of Agder. The event is held in collaboration with the European Centre for Alternative Finance at Utrecht University. Submission deadline: 15.02.2025 Conference website (under construction): https://lnkd.in/daY9Zev8 Relevant for all researchers interested in #alternativefinance #alternativefinancing #crowdfunding #crowdlending #crowdinvesting #cryptocurrencies #blockchain #FinTech #DigitalFundraising #donation #equitycrowdfunding #p2plending #digitallending #entrepreneurialfinance #financialinclusion #microfinance #prosociallending #digitalfinance #digitalfinancialservices #nonbanklender #nonbank