Research Details

Abstract

Despite the benefits of saving in formal financial institutions, the take-up and use of savings accounts are low among the poor. In a randomized experiment across 110 bank branches throughout Mexico, an incentive to open and use a savings account—in which saving earned raffle tickets for cash prizes—caused a 41% increase in the number of accounts opened during the incentive months. Nearly all (96%) of new accounts were opened by previously unbanked households. The temporary two-month incentive had a persistent three-year impact on the flow of deposits at treatment branches. Prize-linked savings can thus benefit both previously-unbanked households and banks.

Type

Working Paper

Author(s)

Paul Gertler, Sean Kendrick Higgins, Aisling Scott, Enrique Seira

Date Published

2021

Citations

Gertler, Paul, Sean Kendrick Higgins, Aisling Scott, and Enrique Seira. 2021. Using Lotteries to Attract Savings.