Increasing savings is an important part of improving the financial security of households in the Philippines. Savings levels have a tendency to be low in developing countries so any policy or intervention that could raise savings rates could improve the financial health and stability of low-income households. IPA is conducting a series of experiments that test various savings product features to better understand the demand for savings products and identify the product features that could successfully mobilize savings among poor households.

As part of this series of savings experiments, IPA is working with First Isabela Cooperative Bank (FICO) to examine a range of methods, beyond financial program incentives and benefits, of encouraging clients to take up a commitment savings product and complete their savings commitment. 10,000 existing or dormant savings clients are offered a savings product with randomly assigned features:

• Interest rate: 3, 4, or 5% per annum
• Give-away items: receive pen, picture of the goal item, or puzzle with the image of the goal item upon take-up
• Post-dated check: receive post-dated check upon take-up

All savings product packages offered by the banks have a commitment feature: the client will set his/her own savings goal item, goal amount, and goal date, and the client will NOT be able to withdraw the savings until he/she reaches the goal.

Door-to-door marketers conduct the baseline survey with Personal Digital Assistance (PDA) to collect the information on demographic characteristics and savings habit. After the completion of the baseline survey, marketers offer product features randomly assigned by the PDA on the spot. FICO Bank’s administrative data is used to analyze impacts on savings levels.