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General

Study Overview

Title:

The impact of formal savings on salaried workers’ spending and borrowing in Eastern Ghana

Study is 3ie funded:

No

Study ID:

RIDIE-STUDY-ID-5409d4c83af40

Initial Registration Date:

09/05/2014

Last Update Date:

12/30/2014

Study Status:

Ongoing

Location(s):

Ghana

Abstract:

Many of North Volta Rural Bank's customers who are salaried workers, and therefore receive their pay via direct deposit to NVRB, make frequent use of high interest payday loans (temporary overdrafts). As part of a randomized controlled trial, including 245 men and 75 women, NVRB offered a product to these customers in which they commit to having a fixed amount taken directly from their salary and put in a commitment savings account, for an 18-month period. The key questions this study will answer are (i) How do individuals adjust their finances in response to regular, automated savings withdrawals? (ii) What do they spend the lump sum on? And (iii) Are there any long-term impacts of having participated in the commitment savings program on economic activities, savings, debt, or spending behavior? (iv) How are these impacts different for men versus for women?

Registration Citation:

Koroknay-Palicz, T., Goldstein, M., Klapper, L., Schaner, S. and Osei, RD., 2014. The impact of formal savings on salaried workers’ spending and borrowing in Eastern Ghana. Registry for International Development for Impact Evaluations (RIDIE). Available at: 10.23846/ridie032

Categories:

Finance

Additional Keywords:

commitment savings

Secondary ID Number(s):

NVRB Salaried Workers Study (Innovations for Poverty Action), NMIMR-IRB CPN 009/13-14 & IRB 00001276 (Noguchi Memorial Institutes for Medical Research – University of Ghana), CPHS 24177 (Dartmouth Co

Principal Investigator(s)

Name of First PI:

Tricia Koroknay-Palicz; Markus Goldstein; Leora Klapper; Niklas Buehren

Change History for Name of First PI

Changed On	Previous Value
12/30/2014	Tricia Gonwa; Markus Goldstein; Leora Klapper; Niklas Buehren

Affiliation:

World Bank

Name of Second PI:

Simone Schaner; Robert Darko Osei

Affiliation:

Dartmouth University; University of Ghana

Study Sponsor

Name:

World Bank

Study Sponsor Location:

United States

Research Partner

Name of Partner Institution:

Innovations for Poverty Action

Type of Organization:

NGO-international

Location:

Ghana

Intervention

Intervention Overview

Intervention:

The intervention is a commitment savings program, called “Salary Susu Plus” (SSP), for individual clients whose salaries are directly deposited into the bank by their employer. Participation in SSP involves committing to automatically transfer a fixed amount of one’s directly deposited monthly salary into an SSP account every month for a period of 18 months. The automatic transfer has to be at least 30 Ghana cedis (approximately US$10) per month. In practice, the mean monthly contribution amount is 43 Ghanaian cedis, which is equivalent to 9 percent of the average study participants’ monthly salary. At the end of the 18 months commitment period, the customer is able to withdraw all savings in the SSP account, along with a bonus equal to one month’s contribution. While clients can withdraw funds from their SSP accounts before the commitment period ends, they can only do so by leaving the SSP program, which means they forfeit the bonus payment and must also pay a penalty equal to one month’s contribution.

Theory of Change:

Multiple Treatment Arms Evaluated?

No

Implementing Agency

Name of Organization:

North Volta Rural Bank

Type of Organization:

Private for profit organization

Program Funder

Name of Organization:

North Volta Rural Bank

Type of Organization:

Private for profit organization

Intervention Timing

Intervention or Program Started at time of Registration?

Yes

Start Date:

12/31/2013

End Date:

05/31/2015

Evaluation Method

Evaluation Method Overview

Primary (or First) Evaluation Method:

Randomized control trial

Other (not Listed) Method:

Additional Evaluation Method (If Any):

Other (not Listed) Method:

Method Details

Details of Evaluation Approach:

All North Volta Rural Bank customers with salaried accounts were invited to participate in this study. For the 320 individuals (245 men and 75 women) who agreed to participate, the study randomly assigned half to a treatment group. Clients in the treatment group were offered an opportunity to sign up for the SSP program, and of these, 71 percent joined the program. Those not offered the product serve as the comparison group. Outcomes of treatment group individuals will be compared to those of the control group. The study will test the impact of the Salary Susu Plus (SSP) product on outcomes measured during, immediately after, and six months after the commitment period, and whether the impact differs across gender. The study will use baseline and follow-up survey data, and administrative data from NVRB.

Outcomes (Endpoints):

- Savings (stock, and flow) - Debt (loans taken, debt stock and flow, including debt repayment) - Transfers and loans given - Expenditures on basic necessities for self and dependents - Expenditures on more discretionary items - Purchase of new durables, or repair of existing durables (e.g. household assets) - Business expenditures and assets - Own and others contributions to household expenses - Economic activities / income

Unit of Analysis:

Individual people

Hypotheses:

The research questions that this study will answer are as follows: A growing body of literature suggests that commitment savings products—voluntary arrangements designed to help individuals overcome social and behavioral barriers to savings—are very effective in increasing savings. However, there are several open questions regarding how these commitment devices work. For example, where do the savings come from? Do people reduce savings elsewhere, reduce their loans and transfers to others, or reduce spending on luxuries or basic necessities? Once the lump sum within the commitment savings device is released, how is it used? Are there any long-term impacts of having participated in the commitment savings program on economic activities, savings, debt, or spending behavior? Is the answer different for men and women? This study aims to address these issues.

Unit of Intervention or Assignment:

Individual people

Number of Clusters in Sample:

n/a

Number of Individuals in Sample:

320

Size of Treatment, Control, or Comparison Subsamples:

160 in treatment; 160 in control

Supplementary Files

Analysis Plan:

Other Documents:

Data

Outcomes Data

Description:

Individual- and household-level survey data, collected during and after the intervention. And administrative data from NVRB.

Data Already Collected?

No

Data Previously Used?

Data Access:

Data Obtained by the Study Researchers?

Data Approval Process:

Approval Status:

Treatment Assignment Data

Participation or Assignment Information:

Yes

Description:

Data Obtained by the Study Researchers?

Data Previously Used?

Data Access:

Data Obtained by the Study Researchers?

Data Approval Process:

Approval Status:

Data Analysis

Data Analysis Status:

Study Materials

Upload Study Materials:

Registration Category

Registration Category:

Prospective, Category 1: Data for measuring impacts have not been collected

Completion

Completion Overview

Intervention Completion Date:

Data Collection Completion Date:

Unit of Analysis:

Clusters in Final Sample:

Total Observations in Final Sample:

Size of Treatment, Control, or Comparison Subsamples:

Findings

Preliminary Report:

Preliminary Report URL:

Summary of Findings:

Paper:

Paper Summary:

Paper Citation:

Data Availability

Data Availability (Primary Data):

Date of Data Availability:

Data URL or Contact:

Access procedure:

Other Materials

Survey:

Survey Instrument Links or Contact:

Program Files:

Program Files Links or Contact:

External Link:

External Link Description:

Description of Changes:

Study Stopped

Date:

Reason: