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Savings Groups reduce vulnerability, but have mixed effects on Financial Inclusion

This paper evaluates the impact of the introduction of savings groups on poverty, vulnerability, and financial inclusion outcomes in rural Peru. Using a cluster randomized control trial and relying on both survey and administrative records, the study investigates the impact of savings groups after more than two years of exposure. It finds that savings groups channel expensive investments such as housing improvements and reduce households’ vulnerability to idiosyncratic shocks, particularly among households in poorer districts.

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