Why Do Financial Inclusion Policies Fail in Mobilizing Savings from the Poor? Lessons from Rural South India

19 Pages Posted: 2 Feb 2018

See all articles by Jann Goedecke

Jann Goedecke

KU Leuven

Isabelle Guérin

Laboratoire Population Environnement Développement (LPED/IRD)

Bert D'Espallier

KU Leuven - Faculty of Business and Economics (FEB)

Govindan Venkatasubramanian

French Institute of Pondicherry

Date Written: March 2018

Abstract

Combining multivariate and qualitative analyses, this micro‐level study suggests an explanation for the persistence of informal savings in rural south India despite publicly run large‐scale programmes to promote bank savings. Gold, in particular, but also Rotating Saving and Credit Associations (ROSCAs) and private lending, remain the dominant forms of savings. We argue that cultural norms and social institutions, such as social class and caste, shape the nature of savings, and also the propensity and opportunities to save. Gold serves multiple purposes, financial, economic, socio‐cultural and political. Furthermore, we find that the preference of Dalits (the lowest caste) for gold illustrates a relative emancipation, which contrasts with the persistence of caste‐related prohibitions preventing them investing in other assets, such as land.

Keywords: banks, economic anthropology, financial inclusion, India, informal saving, microfinance, political economy

Suggested Citation

Goedecke, Jann and Guérin, Isabelle and D'Espallier, Bert and Venkatasubramanian, Govindan, Why Do Financial Inclusion Policies Fail in Mobilizing Savings from the Poor? Lessons from Rural South India (March 2018). Development Policy Review, Vol. 36, pp. O201-O219, 2018. Available at SSRN: https://ssrn.com/abstract=3116476 or http://dx.doi.org/10.1111/dpr.12272

Jann Goedecke (Contact Author)

KU Leuven ( email )

Oude Markt 13
Leuven, Vlaams-Brabant 3000
Belgium

Isabelle Guérin

Laboratoire Population Environnement Développement (LPED/IRD) ( email )

Centre St Charles, Case 10
3 place Victor Hugo
Marseilles, 13331
France

Bert D'Espallier

KU Leuven - Faculty of Business and Economics (FEB) ( email )

Naamsestraat 69
Leuven, B-3000
Belgium

Govindan Venkatasubramanian

French Institute of Pondicherry

11, Saint Louis Street
Pondicherry, Pondicherry 605 001
India

Register to save articles to
your library

Register

Paper statistics

Downloads
0
Abstract Views
80
PlumX Metrics