Microfinance and Psychological Wellbeing: The role of Financial Literacy

Last registered on October 03, 2023
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Pre-Trial

Trial Information

General Information

Title
Microfinance and Psychological Wellbeing: The role of Financial Literacy
RCT ID
AEARCTR-0011047
Initial registration date
May 17, 2023

Initial registration date is when the trial was registered.

It corresponds to when the registration was submitted to the Registry to be reviewed for publication.

First published
May 24, 2023, 12:04 PM EDT

First published corresponds to when the trial was first made public on the Registry after being reviewed.

Last updated
October 03, 2023, 11:16 AM EDT

Last updated is the most recent time when changes to the trial's registration were published.

Locations

Country
Nigeria
Region
Southwest Nigeria

Primary Investigator

Name
Ada Gonzalez-Torres
Affiliation
Ben Gurion University
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Other Primary Investigator(s)

PI Name
Olubunmi Fawunmi Samuel-Adeyemi
PI Affiliation
Ben Gurion University
Contact Investigator

Additional Trial Information

Status
In development
Start date
2023-05-22
End date
2023-12-30
Keywords
Behavior, Finance & Microfinance, Firms & Productivity, Gender
Additional Keywords
Psychological well-being, Training programs
JEL code(s)
D14, O12, D91, G51, G53, J16, H81
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Abstract
This research studies the impacts of financial literacy on financial and psychological well-being of microfinance borrowers in rural Nigeria. We implement a randomized control trial to test the effectiveness of providing a financial literacy training to loan borrowers within a microfinance institution. Having already qualified for and received loans from a microfinance institution, the study explores whether and to what extent financial literacy improves financial and well-being for these rural dwellers.
External Link(s)

Registration Citation

Citation
Fawunmi Samuel-Adeyemi, Olubunmi and Ada Gonzalez-Torres. 2023. "Microfinance and Psychological Wellbeing: The role of Financial Literacy." AEA RCT Registry. October 03. https://doi.org/10.1257/rct.11047-2.2
Sponsors & Partners

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Experimental Details

Interventions

Intervention(s)
Intervention Start Date
2023-10-01
Intervention End Date
2023-11-15

Primary Outcomes

Primary Outcomes (end points)
We have two key outcome variables, which are indexes for:
Psychological well-being;
Financial well-being.
Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
Additionally, as secondary outcomes, study whether the effects come from either of the following variables:
- financial literacy,
- feeling in control of one’s finances,
- women empowerment,
- loan repayment,
- using the loan to invest in the business,
- business health,
- frequency of income,
- weekly income, savings and consumption.
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
We randomly select 160 micro-finance borrowers out of a list of micro-finance borrowers who are female and have active loans, from a microfinance bank in rural Nigeria. We randomly allocate half to our control condition and half to our treatment condition. The treatment condition consists of a 6-week long financial literacy training. We conduct a baseline survey with the entire sample, before the randomization takes place. After the training, we conduct an endline survey with the entire sample.
Experimental Design Details
The micro-finance borrowers are from 4 different branches of LAPO Microfinance Bank in Osogbo, Osun State. The training is conducted by one of the co-PI’s with experience in financial literacy training. The training is delivered in the Yoruba language of south-west Nigeria to improve inclusivity.

We conduct a baseline survey with the entire sample of borrowers before the randomization takes place. Once the baseline survey is conducted, we randomly allocate borrowers to the treatment or control condition. After the training, we conduct an endline survey with the entire sample.

Our target sample size is 50 in the treatment condition (financial literacy training), and 80 in the control condition (no financial literacy training). To allow for low treatment uptake and attrition, we randomly select 80 borrowers in treatment, and 80 borrowers in the control group.
Randomization Method
The randomization is done by a computer.
Randomization Unit
The unit of randomization is a micro-finance borrower, stratified by LAPO branch, client support-officer in charge, whether borrower is part of lending group, meeting day, and range of borrowers in group.
Was the treatment clustered?
No

Experiment Characteristics

Sample size: planned number of clusters
Not applicable.
Sample size: planned number of observations
Approximately 160 loan borrower clients.
Sample size (or number of clusters) by treatment arms
Our target sample size is 50 in treatment condition (financial literacy training), and 80 in control condition (no financial literacy training). To allow for low treatment uptake and attrition, we randomly select 80 borrowers in treatment, and 80 borrowers in the control group.
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
Supporting Documents and Materials
IRB

Institutional Review Boards (IRBs)

IRB Name
Ben-Gurion University African Sustainable Communities Committee
IRB Approval Date
2022-09-15
IRB Approval Number
N/A
IRB Name
Ben-Gurion University Human Subjects Research Committee
IRB Approval Date
2023-05-16
IRB Approval Number
427-5
IRB Name
Ben-Gurion University Human Subjects Research Committee
IRB Approval Date
2023-07-27
IRB Approval Number
513-2
Analysis Plan

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Post-Trial

Post Trial Information

Study Withdrawal

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Intervention

Is the intervention completed?
No
Data Collection Complete
Data Publication

Data Publication

Is public data available?
No

Program Files

Program Files
Reports, Papers & Other Materials

Relevant Paper(s)

Reports & Other Materials