Remittances and Financial Inclusion: Evidence from El Salvador

36 Pages Posted: 20 Apr 2016

See all articles by Diego Anzoategui

Diego Anzoategui

Rutgers University

Asli Demirgüç-Kunt

World Bank - Development Research Group; World Bank

Maria Soledad Martinez Peria

International Monetary Fund (IMF)

Date Written: October 1, 2011

Abstract

This paper investigates the impact of remittances on financial inclusion. This is an important issue given recent studies showing that financial inclusion can have significant beneficial effects on households. Using household-level survey data for El Salvador, the authors examine the impact of remittances on households' use of savings and credit instruments from formal financial institutions. They find that although remittances have a positive impact on financial inclusion by promoting the use of deposit accounts, they do not have a significant and robust effect on the demand for and use of credit from formal institutions. If anything, by relaxing credit constraints, remittances might reduce the need for external financing from financial institutions, while at the same time increasing the demand for savings instruments.

Keywords: Access to Finance, Debt Markets, Population Policies, Remittances, Economic Theory & Research

Suggested Citation

Anzoategui, Diego and Demirgüç-Kunt, Asli and Martinez Peria, Maria Soledad, Remittances and Financial Inclusion: Evidence from El Salvador (October 1, 2011). World Bank Policy Research Working Paper No. 5839. Available at SSRN: https://ssrn.com/abstract=1940342

Diego Anzoategui

Rutgers University ( email )

New Brunswick, NJ
United States

Asli Demirgüç-Kunt

World Bank - Development Research Group ( email )

United States
202-473-7479 (Phone)
202-522-1155 (Fax)

HOME PAGE: http://econ.worldbank.org/staff/ademirguckunt/

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

Maria Soledad Martinez Peria

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

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