Recent evidence shows that the poor desperately need access to savings products. But despite this general consensus, microfinance institutions (MFIs) offering savings products are still under-studied. Using random-effect probit estimation on a dataset of 722 MFIs active over the 2005-2010...

Following recent literature, we hypothesise that saving and borrowing among microfinance clients are substitutes, satisfying the same underlying demand for a regular deposit schedule and a lumpsum withdrawal. We test this using a framed field experiment among women participating in group lending...

We demonstrate that subsidy uncertainty in microfinance can lead to mission drift and defeat poverty alleviation efforts. Our model shows that microfinance institutions, fearing that subsidies may dry up, have no alternative but to build precautionary savings by serving wealthier clients,...