How Much Does Having a Bank Account Help the Poor?

Forthcoming: Journal of Development Studies

43 Pages Posted: 12 Jan 2016 Last revised: 31 Aug 2017

Date Written: June 12, 2017

Abstract

Having a bank account is widely regarded as the first step toward financial inclusion of the poor. Funds deposited in bank account are also observed to lead to higher savings. Exploiting special features of National Rural Employment Guarantee Scheme (NREGS) of India, our estimates indicate that households that receive NREGS wages through bank do not appear to spend more on education than other comparable households that receive cash payment. The district level intention to treat specification produces similar results. The findings suggest that the rural poor face constraints in accessing their bank accounts due to financial illiteracy and other problems.

Keywords: Bank account, education, household expenditure, cash pay, NREGA, Direct benefit transfer.

JEL Classification: D10, D14, I20, I380, O150

Suggested Citation

Sen, Gitanjali and De, Sankar, How Much Does Having a Bank Account Help the Poor? (June 12, 2017). Forthcoming: Journal of Development Studies, Available at SSRN: https://ssrn.com/abstract=2714214 or http://dx.doi.org/10.2139/ssrn.2714214

Gitanjali Sen (Contact Author)

Shiv Nadar University ( email )

NH-91, Village- Chithera, Tehsil-Dadri,
Dist. Gautam Buddha Nagar, UP
Gautam Buddha Nagar, Uttar Pradesh
India

Sankar De

Independent ( email )

Villa 286 bTR
Srisalam Highway
Hyderabad, Telengana
+91 7042662505 (Phone)

Do you have negative results from your research you’d like to share?

Paper statistics

Downloads
134
Abstract Views
817
Rank
385,726
PlumX Metrics