Savings for resilience: Investigating saving instruments in Mali
Annkathrin Wahbi1, Eike Nordmeyer1, Tim Ölkers1
1Department of Agricultural Economics and Rural Development, Georg-August-University Goettingen, Goettingen, Germany.
Plos One
|July 11, 2025
Summary
Financial infrastructure significantly impacts saving behaviors among Malian farmers. Promoting secure, accessible savings mechanisms can enhance household resilience and support poverty reduction efforts in low-income economies.
Area of Science:
- Agricultural Economics
- Development Economics
- Behavioral Economics
Background:
- Poverty remains a significant challenge in Sub-Saharan Africa, with 35% of the population living below the poverty line.
- Promoting household savings is viewed as a cost-effective strategy for enhancing resilience and fostering pro-poor development.
Purpose of the Study:
- To analyze the determinants of saving behavior among 374 Malian farmers.
- To investigate factors influencing the decision to save and the amount saved, considering different saving channels (mobile money, bank account, secret place).
Main Methods:
- Employed a two-step selection model, including a probit model for saving decisions and an Ordinary Least Squares regression for savings amounts.
- Utilized an instrumental variable approach with walking distance to the nearest mobile money agent to address endogeneity concerns.
- Disaggregated savings outcomes based on the method of saving (mobile money, bank account, secret place).
Main Results:
- Saving determinants exhibit considerable heterogeneity, with supply-side factors like infrastructure quality playing a crucial role.
- Saving in a 'secret place' remains popular, especially among younger farmers and those without household smartphone access.
- Significant potential exists to transition informal savings to formal accounts for interest gains and enhanced security.
Conclusions:
- Improving financial infrastructure and accessibility is key to enhancing savings among smallholder farmers.
- Targeted interventions can encourage the shift from informal to formal savings, boosting financial inclusion and resilience.
- Accessible and secure saving mechanisms hold transformative potential for poverty alleviation in low-income economies.
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