Claudia Martínez: Evaluating the impact of delivering ccts
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Transcript of Claudia Martínez: Evaluating the impact of delivering ccts
EVALUATING THE IMPACT OF DELIVERING CCTS THROUGH THE BANK AND FINANCIAL EDUCATION
Claudia Mar<nez Alvear Catholic University of Chile September, 2014
MAIN POINTS
§ Research Agenda § Two RCT evaluaRons in Chile on financial inclusion:
• Chile CUENTA: EvaluaRng the impact of delivering CCTs through the bank.
• EvaluaRng the impact of Financial EducaRon Program.
RESEARCH AGENDA § A research agenda has been developed, based in “Todas Cuentan” § Research plaYorm that promote programs evaluaRon on financial inclusion. § The aim is to idenRfy soluRons for the local problems (resource management, women empowerment). § The plaYorm has incorporated regional research. § The project is funded for: The International Development Research Centre (IDRC). Institute for Peruvian Studies.
Fundación Capital.
§ In Chile, the plaYorm has financed: Chile CUENTA evaluation.
Financial Education evaluation. “Saving accounts” evaluation.
CHILE CUENTA
Abhijit Banerjee Massachuse]s InsRtute of Technology
Claudia Mar2nez A.
Universidad Católica de Chile
Esteban Puentes Universidad de Chile
MOTIVATION § Strong increase in CondiRonal Cash Transfer (CCT) in the region + concerns on lack of financial inclusion.
• Subsidies payment through the back accounts.
§ However, no clear the evidence about the addiRonal benefits that the nexus between the CCT program and this policy could generate (De los Ríos & Trivelli 2011).
• Samaniego y Tejerina (2010) and Maldonado y Tejerina (2010) detect li]le use of the bank accounts between the CCTs beneficiaries (Oportunidades, México).
• Seira (2010) detects posiRve impact in the beneficiary’s formal savings that get their benefits through their bank accounts (Oportunidades, México).
CONTEXT
§ ¿What is Chile CUENTA? • This program changes the way in which the social benefits are delivered: the cash subsidies payment changes to the bank account subsidies payment.
§ ¿Who implements it? • The Ministry of Social Development (Chilean Government).
§ ¿What is the goal? • To improve poor people’s financial access.
EVALUATION DESIGN
§ Sample: Five municipaliRes of SanRago, Chile
§ Time frame: program implementaRon started in October, 2012. Follow up: Late 2014.
§ Treatment arms: § Control group:
• Puente Program beneficiaries who receive their social benefits in cash. • N=810
§ Treatment group: • Puente Program beneficiaries who receive their social benefits in cash and get the chance to receive the subsidies payment trough bank account.
• N=2,422
EVALUATION IMPLEMENTATION
§ The take up 55% rate of all treatment group allows to find 0,22 sd effect (US$8 monthly average saving in last three month).
34%
55%
11%
Take up Chile CUENTA
Rechazados Aceptados No aplica
[1] [2] [3] [4] [5]
Municipality N Treated N Rejected Total accepted Don’t apply Take Up (3/1)
Puente Alto 736 275 333 128 45%
Peñaflor 224 71 144 9 64%
Maipú 370 112 227 31 61%
San Bernardo 811 279 456 76 56%
Conchalí 281 81 164 36 58%
TOTAL 2.422 818 1.324 280 55% The treatment’s individuals that didn’t get Chile CUENTA offer aren’t consider.
PROCESS EVALUATION
§ Process EvaluaRon in parallel to the implementaRon.
§ EvaluaRon AcRviRes: Focus Group and Interviews. The scheme shows the most important results.
Posi>v
e Po
ints
Comfort. OrganizaRon. Speed. Bank account use. Security. N
ega>
ve Points Date change.
Statement accounts are received. Li]le informaRon about bank account balance and charges.
Other Points Chile CUENTA as a
good mechanism for money management but not as a saving incenRve. Management problems. Extra work to “Family support”.
Ø The main obstacles are management problems.
Ø People appreciate the possibility to administrate their money through a bank account.
NEXT STEPS
§ Follow-‐up survey: December 2014
§ Analysis: May 2014
FINANCIAL EDUCATION
Claudia Mar2nez A.
Universidad Católica de Chile Esteban Puentes
Universidad de Chile
Alejandro Drexler University of Texas at AusRn
MOTIVATION
§ No clear evidence of what works (Xu and Zia 2012). • Rules of thumbs are more effecRve than regular training in affecRng business pracRces (Drexler, et al. 2012).
• In general, financial educaRon programs don’t have effects on sales or business profits (Karlan and Valdivia 2012).
• In Chile Mar<nez, Puentes and Ruiz-‐Tagle (2013) studied the gather impact of financial educaRon and assets transference. They detected a posiRve effect on beneficiaries’ income.
CONTEXT § ¿What is the program about? • 20 hours of group workshop. • Oriented to “Microempresa”. • Four modules: 1.Budget; 2.Saving; 3.Household wealth and indebtedness; 4. Investment.
§ ¿Who implements it? • FOSIS (MDS).
§ ¿What is the goal? • Provide financial tools and informaRon.
EVALUATION DESIGN
§ Sample: Entrepreneurship Fosis 2012 Program Beneficiaries (YES,YEI, YEII). Regions: V, VII and RM.
§ Time frame: between December 2012 and May 2013.
§ Treatment arms: The invitaRon to parRcipate was randomized. o Control group:
• No invitaRon to parRcipate. o Treatment group:
• InvitaRon to parRcipate.
Region Total Evaluation Participants Initial Month End Month
V 976 January 2013 March 2013
VII 470 December 2012 December 2012
RM 3.124 January 2013 May 2013
Total 4.570 Source: self generated with reports FOSIS . Participants of the evaluation includes invited to participate in the program, the reserve group and the control group.
Dates and number of evalua>on par>cipants by region
EVALUATION DESIGN
EVALUATION DESIGN
§ Impact variables: level of formal debt of individuals and access to formal credit. (Only variables available in administraRve data)
§ Hypothesis: o Rate credit reducRon. o Debt level, two opposing effect. o Be]er credit condiRons.
EVALUATION DESIGN § Using administraRve data: from the Superintendency of Banks and Financial InsRtuRons (SBIF) and FOSIS. § SBIF Data: from January 2012 to August 2013.
• Credit requested with informaRon about interest rate, amount and term in months.
• The average debt and the credit unions unpaid debts. • Bank debt and average unpaid debts separated by type: commercial, consumer and mortgage.
§ With Financial Household Survey (EFH), the appropriateness of using SBIF data for the evaluaRon is analyzed: • 23.8% of households with the lowest income (1 quinRle) have data that might be found in SBIF.
• 64.9% of total debt corresponds to a formal debt.
EVALUATION DESIGN § FOSIS data:
• PAM debts and the insRtuRon requested (the most common Fondo Esperanza FoundaRon).
• Rates and subsidies amount.
• InformaRon about entrepreneurship: economic acRvity, formalizaRon, sales levels, among others.
§ The crossing with FOSIS data allows to know how many individuals applied for funding through PAM:
• Between March 2012 and December 2013, 408 parRcipants have requested funding through PAM, with a total of 586 credits.
EVALUATION IMPLEMENTATION Acceptance rate of the invita>on, total and by Region
V VII RM Total
Total of Evaluations Participants 976 470 3124 4570
Invited 446 260 1253 1959
Trained 153 96 232 481
Acceptance rate 34.3% 36.9% 18.5% 24.6%
§ High regional variaRon. § Given this acceptance rate and the number of individuals, the minimum
detectable size is 0.34 standard deviaRons (with 80% power and 5% significance).
EMPIRICAL SPECIFICATION
§ The empirical specificaRon used was: 𝒚↓𝒊 =𝜶+𝜷𝑫↓𝒊 +𝜸𝑿↓𝒊 + 𝒖↓𝒊 (𝟏) 𝒚↓𝒕 =𝜶+𝜷𝑫+𝜸𝑿+ 𝒚↓𝒕−𝟏𝟐 +𝒖 (𝟐)
Where: o 𝑦: The studied result (monthly level of debt, by type of debt). o 𝐷↓𝑖 : Dummy variable that equals 1 if the individual was invited to par>cipate in the workshops and 0 otherwise. o 𝑋: Control variables(region, above or under the 50 income percen>l ande age). o 𝑦↓𝑡−12 : Monthly level of total debt/ debt dummy/ unpaid debt dummy, 12 months before the measurment.
§ 𝛽 represents the impact of the offer of parRcipaRon in the program
RESULTS
§ No effect on studied variables such as interest rate, commercial debt level, consumpRon credit, mortgage credit, cooperaRve debt, total debt and probability of having debt or unpaid debt three months axer the treatment ended.
§ Similar results are obtained axer removing the 1% of higher debt levels (outliers).
§ AddiRonally, a regional analysis is done.
CONCLUSIONS
§ No effect was found over the formal debt and the PAM credit taking.
§ The low acceptance rate makes difficult to find an impact and invites us to rethinking the program design.
§ Effects in saving?
§ The implementers and users indicate that the topic has a great relevance and the effort should be conRnued through the FOSIS.
§ Importance of evaluaRon of process, and impact evaluaRon.
GENERAL CONCLUSIONS
§ Important topic § A lot to be learned § Importance of process and impact evaluaRon § Growing literature § Consider the heterogeneity of individuals and the right treatment Rmes
EVALUATING THE IMPACT OF DELIVERING CCTS THROUGH THE BANK AND FINANCIAL EDUCATION
Claudia Mar<nez Alvear Catholic University of Chile September, 2014