Using Lotteries to Attract Deposits

Paul Gertler, Sean Higgins, Aisling Scott and Enrique Seira
Authors registered in the RePEc Author Service: Aisling J. Reynolds-Feighan

No 31529, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Despite the importance of deposit financing for lending, banks in developing countries struggle to attract deposits. In a randomized experiment across 110 bank branches throughout Mexico, a lottery incentive based on net monthly deposits caused a 40% increase in the number of accounts opened and a 21% increase in the number of deposits during the lottery months. Nearly all new accounts (96%) were opened by households previously unbanked at any bank. The temporary two-month incentive had a persistent 2-3 year impact on the flow of deposits and stock of savings, and increased the present value of branch profits by 6%.

JEL-codes: G29 G41 O16 (search for similar items in EconPapers)
Date: 2023-08
New Economics Papers: this item is included in nep-ban and nep-fdg
Note: CF DEV PR
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