Does group inclusion hurt financial inclusion? Evidence from ultra-poor members of Ugandan savings groups

Alfredo Burlando and Andrea Canidio

Journal of Development Economics, 2017, vol. 128, issue C, 24-48

Abstract: Millions of ultra-poor households in sub-Saharan Africa rely exclusively on savings groups to meet their financial needs. However, the ability of savings groups to fully meet these needs remains unclear. We randomize at the village level the proportion of ultra-poor members of newly-formed savings groups. We find that scarcity of loanable funds is more severe in poorer groups and affects disproportionately their poorest members. A trade-off emerges between the inclusion of ultra-poor households into a savings group and its ability to provide credit to these same ultra-poor households.

Keywords: Savings groups; VSLA; Financial inclusion; Microfinance; Self-help groups (search for similar items in EconPapers)
JEL-codes: O12 O16 (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (12)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:deveco:v:128:y:2017:i:c:p:24-48

DOI: 10.1016/j.jdeveco.2017.05.001

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