IDEAS home Printed from https://ideas.repec.org/a/wly/mgtdec/v44y2023i8p4363-4376.html
   My bibliography  Save this article

Competition between postal and bank branches for household savings: Empirical evidence from India

Author

Listed:
  • Cledwyn Fernandez

Abstract

Postal financial services have been the beacon on financial inclusion globally. However, with the impact of digitalization, the physical network of post offices no longer remains the core competency. This article analyzes the various factors contributing to household savings across both banks and post offices. It examines the effect of competition at the network level between banks and post offices. The main finding is that the extensive physical network of post offices does not significantly impact postal deposits. There is competition between post offices and private and public banks at the rural population class level. However, at the urban population class level, competition exists only at two levels: between private banks and India Post and between nationalized banks and India Post.

Suggested Citation

  • Cledwyn Fernandez, 2023. "Competition between postal and bank branches for household savings: Empirical evidence from India," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 44(8), pages 4363-4376, December.
    • Handle: RePEc:wly:mgtdec:v:44:y:2023:i:8:p:4363-4376
    DOI: 10.1002/mde.3954
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/mde.3954
    Download Restriction: no
    File URL: https://libkey.io/10.1002/mde.3954?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Athreya, Siva & Somanathan, Rohini, 2008. "Quantifying spatial misallocation in centrally provided public goods," Economics Letters, Elsevier, vol. 98(2), pages 201-206, February.
    2. Allen, Franklin & Demirguc-Kunt, Asli & Klapper, Leora & Martinez Peria, Maria Soledad, 2016. "The foundations of financial inclusion: Understanding ownership and use of formal accounts," Journal of Financial Intermediation, Elsevier, vol. 27(C), pages 1-30.
    3. Ralf Bebenroth & Diemo Dietrich & Uwe Vollmer, 2009. "Bank regulation and supervision in bank-dominated financial systems: a comparison between Japan and Germany," European Journal of Law and Economics, Springer, vol. 27(2), pages 177-209, April.
    4. Nitin Kumar, 2013. "Financial inclusion and its determinants: evidence from India," Journal of Financial Economic Policy, Emerald Group Publishing, vol. 5(1), pages 4-19, February.
    5. Hausman, Jerry, 2015. "Specification tests in econometrics," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 38(2), pages 112-134.
    6. Mandira Sarma, 2008. "Index of Financial Inclusion," Working Papers id:1575, eSocialSciences.
    7. Abhijit V. Banerjee & Esther Duflo, 2007. "The Economic Lives of the Poor," Journal of Economic Perspectives, American Economic Association, vol. 21(1), pages 141-168, Winter.
    8. Chetan Ghate, 2008. "Understanding divergence in India: a political economy approach," Journal of Economic Policy Reform, Taylor and Francis Journals, vol. 11(1), pages 1-9.
    9. Cyn-Young Park & Rogelio Mercado, 2018. "Financial Inclusion, Poverty, And Income Inequality," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 63(01), pages 185-206, March.
    10. O'Hara, Maureen & Easley, David, 1979. "The Postal Savings System in the Depression," The Journal of Economic History, Cambridge University Press, vol. 39(3), pages 741-753, September.
    11. Mark Rosenzweig & Andrew D. Foster, 1996. "Financial Intermediation, Transfers and Commitment: Do Banks Crowd Out Private Insurance Arrangements in Low-Income Rural Areas?," Home Pages _079, University of Pennsylvania.
    12. Claudio Oliveira De Moraes & José Americo Pereira Antunes & Márcio Silva Coutinho, 2020. "What is the effect of banking concentration and competition on financial development? An international assessment," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 48(6), pages 1162-1176, October.
    13. Paradi, Joseph C. & Zhu, Haiyan, 2013. "A survey on bank branch efficiency and performance research with data envelopment analysis," Omega, Elsevier, vol. 41(1), pages 61-79.
    14. Chinmay Tumbe, 2015. "Towards financial inclusion: The post office of India as a financial institution, 1880–2010," The Indian Economic & Social History Review, , vol. 52(4), pages 409-437, October.
    15. Demetriades, Panicos O & Luintel, Kul B, 1996. "Banking Sector Policies and Financial Development in Nepal," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 58(2), pages 355-372, May.
    16. Nitin Kumar, 2013. "Financial inclusion and its determinants: evidence from India," Journal of Financial Economic Policy, Emerald Group Publishing Limited, vol. 5(1), pages 4-19, April.
    17. Iftikhar Khan & Ismail Khan & Aziz Ullah Sayal & Muhammad Zubair Khan, 2021. "Does financial inclusion induce poverty, income inequality, and financial stability: empirical evidence from the 54 African countries?," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 49(2), pages 303-314, March.
    18. Biplob Kumar Nandi & Gazi Quamrul Hasan & Md. Humayun Kabir, 2021. "A tale of the financial inclusion-growth nexus and the degree of financial inclusion: a dynamic panel approach on selected developing countries," Journal of Financial Economic Policy, Emerald Group Publishing Limited, vol. 14(3), pages 381-402, July.
    19. Nitin Kumar, 2013. "Financial inclusion and its determinants: evidence from India," Journal of Financial Economic Policy, Emerald Group Publishing Limited, vol. 5(1), pages 4-19, April.
    20. Robin Burgess & Rohini Pande & Grace Wong, 2005. "Banking for the Poor: Evidence From India," Journal of the European Economic Association, MIT Press, vol. 3(2-3), pages 268-278, 04/05.
    21. Naoyuki Yoshino & Peter J. Morgan, 2018. "Financial Inclusion, Financial Stability And Income Inequality: Introduction," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 63(01), pages 1-7, March.
    22. Athreya, Siva & Somanathan, Rohini, 2008. "Quantifying spatial misallocation in centrally provided public goods," Economics Letters, Elsevier, vol. 98(2), pages 201-206, February.
    23. Donald D. Hester & Giorgio Calcagnini & Riccardo De Bonis, 2001. "Competition Through Innovation: ATMs in Italian Banks," Rivista italiana degli economisti, Società editrice il Mulino, issue 3, pages 359-382.
    24. Thanh Pham Thien Nguyen & Son Hong Nghiem, 2020. "The Effects Of Competition On Efficiency: The Vietnamese Banking Industry Experience," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 65(06), pages 1507-1536, December.
    25. Das, Samarjit & Sinha, Gouranga & Mitra, Tushar K., 2010. "Regional convergence of growth, inequality and poverty in India--An empirical study," Economic Modelling, Elsevier, vol. 27(5), pages 1054-1060, September.
    26. Lakshmi Kumar & D. Malathy & L.S. Ganesh, 2011. "The diffusion of ATM technology in Indian banking," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 38(4), pages 483-500, September.
    27. Mandira Sarma, 2008. "Index of Financial Inclusion," Finance Working Papers 22259, East Asian Bureau of Economic Research.
    28. Gitanjali Sen & Sankar De, 2018. "How Much Does Having a Bank Account Help the Poor?," Journal of Development Studies, Taylor & Francis Journals, vol. 54(9), pages 1551-1571, September.
    29. Lakshmi Kumar & D. Malathy & L.S. Ganesh, 2011. "The diffusion of ATM technology in Indian banking," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 38(4), pages 483-500, September.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Guillermo Boitano & Deybi Franco Abanto, 2020. "Challenges of financial inclusion policies in Peru," Revista Finanzas y Politica Economica, Universidad Católica de Colombia, vol. 12(1), pages 89-117, June.
    2. repec:rfh:jprjor:v:9:y:2023:i:1:p:1-12 is not listed on IDEAS
    3. Shruti Malik & Girish Chandra Maheshwari & Archana Singh, 2019. "Understanding Financial Inclusion in India: A Theoretical Framework Building Through SAP–LAP and Efficient IRP," Global Journal of Flexible Systems Management, Springer;Global Institute of Flexible Systems Management, vol. 20(2), pages 117-140, June.
    4. Anh L.N. Ngo, 2019. "Index of Financial Inclusion and the Determinants: An Investigation in Asia," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 9(12), pages 1368-1382, December.
    5. Shah, Shahid Manzoor & Ali, Amjad, 2023. "Macro Dimensions of Financial Inclusion Index and its Status in Developing Countries," MPRA Paper 118036, University Library of Munich, Germany.
    6. Fareeha Adil & Abdul Jalil, 2020. "Determining the Financial Inclusion Output of Banking Sector of Pakistan—Supply-Side Analysis," Economies, MDPI, vol. 8(2), pages 1-20, May.
    7. Tram, Thi Xuan Huong & Lai, Tien Dinh & Nguyen, Thi Truc Huong, 2023. "Constructing a composite financial inclusion index for developing economies," The Quarterly Review of Economics and Finance, Elsevier, vol. 87(C), pages 257-265.
    8. Thanh Tam Le & Nguyen Dieu Linh Dang & Thi Dieu Thu Nguyen & Thanh Son Vu & Manh Dung Tran, 2019. "Determinants of Financial Inclusion: Comparative Study of Asian Countries," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 9(10), pages 1107-1123, October.
    9. Lee, Chien-Chiang & Chen, Pei-Fen & Chu, Pin-Jie, 2023. "Green recovery through financial inclusion of mobile payment: A study of low- and middle-income Asian countries," Economic Analysis and Policy, Elsevier, vol. 77(C), pages 729-747.
    10. Ayushi Raichoudhury, 2020. "Major Determinants of Financial Inclusion: State-Level Evidences from India," Vision, , vol. 24(2), pages 151-159, June.
    11. Mohamed Noureldin Sayed & Amir Shusha, 2019. "Determinants of Financial Inclusion in Egypt," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 9(12), pages 1383-1404, December.
    12. Amit Pandey & Ravi Kiran & Rakesh Kumar Sharma, 2023. "Investigating the Determinants of Financial Inclusion in BRICS Economies: Panel Data Analysis Using Fixed-Effect and Cross-Section Random Effect," Sustainability, MDPI, vol. 15(2), pages 1-21, January.
    13. Kalandi Charan Pradhan & Ritik Sharma, 2022. "Assessing the spatiotemporal financial inclusion and its determinants: a sub-national analysis of India," Asia-Pacific Journal of Regional Science, Springer, vol. 6(2), pages 635-681, June.
    14. Gupta, Suraksha & Kanungo, Rama Prasad, 2022. "Financial inclusion through digitalisation: Economic viability for the bottom of the pyramid (BOP) segment," Journal of Business Research, Elsevier, vol. 148(C), pages 262-276.
    15. Luisa Blanco & Salvador Contreras & Amit Ghosh, 2022. "Impact of Great Recession bank failures on use of financial services among racial/ethnic and income groups," Southern Economic Journal, John Wiley & Sons, vol. 88(4), pages 1574-1598, April.
    16. Vanesa Pesqué‐Cela & Lihui Tian & Deming Luo & Damian Tobin & Gerhard Kling, 2021. "Defining and measuring financial inclusion: A systematic review and confirmatory factor analysis," Journal of International Development, John Wiley & Sons, Ltd., vol. 33(2), pages 316-341, March.
    17. Loan Thi-Hong Van & Anh The Vo & Nhan Thien Nguyen & Duc Hong Vo, 2021. "Financial Inclusion and Economic GROWTH: An International Evidence," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 57(1), pages 239-263, January.
    18. Peterson K. Ozili, 2021. "Financial inclusion research around the world: A review," Forum for Social Economics, Taylor & Francis Journals, vol. 50(4), pages 457-479, October.
    19. Simontinti Das & Amrita Chatterjee, 2021. "Role of ICT Dissemination and Digital Finance in Poverty Eradication and Income Inequality Reduction: A Sub-national Level Study from India," Working Papers 2021-210, Madras School of Economics,Chennai,India.
    20. Domenica Federico & Maria Adele Milioli & Antonella Notte & Lucia Poletti, 2020. "Financial and Social Inclusion and Financial Sector Development: An Outline in the EU28," American Journal of Economics and Business Administration, Science Publications, vol. 12(1), pages 14-35, January.
    21. Lyons, Angela C. & Kass-Hanna, Josephine & Fava, Ana, 2022. "Fintech development and savings, borrowing, and remittances: A comparative study of emerging economies," Emerging Markets Review, Elsevier, vol. 51(PA).

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:mgtdec:v:44:y:2023:i:8:p:4363-4376. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www3.interscience.wiley.com/cgi-bin/jhome/7976 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.