Transaction Cost and the Viability of Rural Financial Intermediaries

Teodoro S. Untalan and Carlos E. Cuevas

Philippine Journal of Development from Philippine Institute for Development Studies

Abstract: Recognition of a continuous improvement in the formal financial system is necessary for economic growth. Over the years, the government has been infusing cheap funds into the rural sector. Unfortunately, it overlooks a number of serious issues regarding bank’s transaction costs. This article develops a method of estimating transaction costs for each bank activity. It also explains the differences and the composition of transaction costs among commercial banks, rural banks and private development banks.

Keywords: transaction costs; financial system; banking system; commercial banks; deposit liabilities (search for similar items in EconPapers)
Pages: 52
Date: 1989
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Persistent link: https://EconPapers.repec.org/RePEc:phd:pjdevt:jpd_1989_vol__xvi_no_1-b

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