AEA RC T Registr y

The American Economic Association's registry for randomized controlled trials

Limited access to formal financial institutions is considered a constraint on the ability of poor households to pursue various socio-economic goals and manage negative income and health shocks.

The current study will evaluate the impact of rural bank branch expansion at both the household and village level, using a randomized controlled trial. Researchers will evaluate a financial service delivery model that uses bank branches in villages to provide a full range of credit, savings, and insurance services to low and medium-income households. The study will assess the impact of financial access in this form on household and community economic outcomes, health, agricultural behavior and social networks.

Together with partner organization IFMR Rural Channels, a rural financial services provider with presence in Tamil Nadu, Orissa and Uttarakhand, researchers aim to gain an in-depth understanding of the impact of provision of financial services, as delivered through the KGFS model, in rural Tamil Nadu. Their services provision model, developed and supported by IFMR Rural Finance, focuses on high quality origination through geographically-focused community financial institutions. It provides access to a broad range of products including (but not limited to) loans, savings, insurance and investment options to households using a customized wealth management approach focused on ensuring the suitability of products sold to each household’s unique financial situation.

The results of such a study could help shape the development of financial instruments targeted at rural households and inform policy on financial inclusion in India and abroad.