Can Mobile-Linked Bank Accounts Bolster Savings? Evidence from a Randomized Controlled Trial in Sri Lanka | Zendy

Suresh de Mel | Zendy; Craig McIntosh | Zendy; Ketki Sheth | Zendy; Christopher Woodruff | Zendy

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Can Mobile-Linked Bank Accounts Bolster Savings? Evidence from a Randomized Controlled Trial in Sri Lanka

Author(s) -

Suresh de Mel,

Craig McIntosh,

Ketki Sheth,

Christopher Woodruff

Publication year - 2020

Publication title -

the review of economics and statistics

Language(s) - English

Resource type - Journals

SCImago Journal Rank - 8.999

H-Index - 165

eISSN - 1530-9142

pISSN - 0034-6535

DOI - 10.1162/rest_a_00956

Subject(s) - financial inclusion , mobile payment , sri lanka , savings account , database transaction , limiting , business , bank account , service (business) , transaction cost , monetary economics , economics , financial system , financial services , finance , engineering , computer science , marketing , database , mechanical engineering , socioeconomics , payment , tanzania

We introduce a new mobile money interface that permits Sri Lankans to deposit mobile airtime balances directly into a formal bank account. Randomizing access and prices, we find a small increase in savings deposits with the partner institution and formal banks more generally, but no change in overall savings. When the deposit transaction costs are completely removed, only 26 percent use the mobile deposit service, and only 7 percent use it frequently. Our results imply that deposit transaction costs are not a significant barrier to increasing savings, limiting the potential gains of mobile-linked savings products for financial inclusion.

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