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on Financial Literacy and Education |
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Issue of 2021‒07‒12
three papers chosen by |
| By: | Jennifer L. Dlugosz; Brian T. Melzer; Donald P. Morgan |
| Abstract: | The 25 percent of low-income Americans without a checking account operate in a separate but unequal financial world. Instead of paying for things with cheap, convenient debit cards and checks, they get by with “fringe” payment providers like check cashers, money transfer, and other alternatives. Costly overdrafts rank high among reasons why households “bounce out” of the banking system and some observers have advocated capping overdraft fees to promote inclusion. Our recent paper finds unintended (if predictable) effects of overdraft fee caps. Studying a case where fee caps were selectively relaxed for some banks, we find higher fees at the unbound banks, but also increased overdraft credit supply, lower bounced check rates, and more low-income households with checking accounts. That said, we recognize that overdraft credit is expensive, sometimes more than even payday loans. In lieu of caps, we see increased overdraft credit competition and transparency as alternative paths to cheaper deposit accounts and increased inclusion. |
| Keywords: | overdrafts; unbanked; inclusion; price ceilings; bounced checks |
| JEL: | G21 G28 |
| Date: | 2021–06–30 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fednls:92834&r= |
| By: | Martínez, Ana Laura; Reséndiz, César |
| Abstract: | En este documento se incorporan las pautas elementales derivadas del derecho a la igualdad y no discriminación dispuestas en la Ley Federal para Prevenir y Eliminar la Discriminación (LFPED) y se responde a la búsqueda de la promoción de la igualdad en las esferas sociales, políticas y económicas de la vida de la población mexicana. En el estudio se reconoce la naturaleza transversal del problema de la discriminación estructural y su impacto en los bajos niveles de bancarización que prevalecen en México, buscando visibilizar los procesos discriminatorios que se fundamentan en prejuicios inconscientes y automáticos que impactan las interacciones financieras de amplios grupos de la sociedad mexicana. |
| Keywords: | INCLUSION FINANCIERA, INSTITUCIONES FINANCIERAS, BANCOS, POLITICA CREDITICIA, IGUALDAD, INSTITUCIONES FINANCIERAS DEL GOBIERNO, BANCOS DE DESARROLLO, BIENESTAR SOCIAL, DIRECTRICES, FINANCIAL INCLUSION, FINANCIAL INSTITUTIONS, BANKS, CREDIT POLICY, EQUALITY, GOVERNMENT FINANCIAL INSTITUTIONS, DEVELOPMENT BANKS, SOCIAL WELFARE, GUIDELINES |
| Date: | 2021–06–23 |
| URL: | http://d.repec.org/n?u=RePEc:ecr:col094:46980&r= |
| By: | Ajay Chhibber (George Washington University) |
| Abstract: | India's financial system has never collapsed - unlike many other emerging economies. But it suffers from a deep and expanding silent crisis, which has made it one of the most inefficient and non-inclusive financial systems in the world. This paper unravels the reasons for this deep crisis - who is responsible - the regulators, populist politicians, crony capitalists and India's fiscal dominance. It shows that all the above are culpable. It lays out the major reforms needed and argues that if deep surgery is not performed India cannot emerge as a global economic powerhouse in the 21st century and will remain stuck in a low middle-income trap. |
| Keywords: | Financial Crisis; Public Sector Banks; Financial Inclusion; Banking Reform |
| JEL: | G00 G01 G18 G21 G32 G33 |
| Date: | 2021–09 |
| URL: | http://d.repec.org/n?u=RePEc:gwi:wpaper:2021-09&r= |