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Which Households Use Banks? Evidence from the Transition Economies (Replaced by CentER DP 2011-089)

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Author Info

  • Beck, T.H.L.
  • Brown, M.

    (Tilburg University, Center for Economic Research)

Abstract

This paper uses survey data for 29,000 households from 29 transition economies to explore how the use of banking services is related to household characteristics, bank ownership structure and the development of the financial infrastructure. At the household level we find that the holding of a bank account or bank card increases with income, wealth and education in most countries and also find evidence for an urban-rural gap, as well as for a role of religion and social integration. Our results show that foreign bank ownership is associated with more bank accounts among high-wealth, high-income, and educated households. State ownership, on the other hand, does not induce financial inclusion of rural and poorer households. We find that higher deposit insurance coverage, better payment systems and creditor protection encourage the holding of bank accounts in particular by high-income and high-wealth households. All in all, our findings shed doubt on the ability of policy levers to broaden the financial system to disadvantaged groups.

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Bibliographic Info

Paper provided by Tilburg University, Center for Economic Research in its series Discussion Paper with number 2010-92.

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Date of creation: 2010
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Handle: RePEc:dgr:kubcen:201092

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Web page: http://center.uvt.nl

Related research

Keywords: Access to finance; Bank-ownership; Deposit insurance; Payment system; Creditor protection;

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References

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  10. Beck, H.T.L. & Demirgüç-Kunt , A. & Peria, M.M, 2007. "Reaching out: Access to and use of banking services across countries," Open Access publications from Tilburg University urn:nbn:nl:ui:12-3125425, Tilburg University.
  11. Thorsten Beck & Asli Demirgüç-Kunt & Maria Soledad Martinez Peria, 2008. "Banking Services for Everyone? Barriers to Bank Access and Use around the World," World Bank Economic Review, World Bank Group, vol. 22(3), pages 397-430, November.
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  22. Beck, Thorsten & Cull, Robert & Fuchs, Michael & Getenga, Jared & Gatere, Peter & Randa, John & Trandafir, Mircea, 2010. "Banking sector stability, efficiency, and outreach in Kenya," Policy Research Working Paper Series 5442, The World Bank.
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