Female Empowerment: Impact of a Commitment Savings Product in the Philippines

the SEED account helped them overcome their self-control problem and led to improved savings
practices (in earlier research, we do not find that the time-inconsistent women actually save more
than the time-consistent women).

The final statement (Columns 7 and 8) is “I often find that I regret spending money. I wish
that when I had cash, I was better disciplined and saved it rather than spent it.” Being assigned to
treatment makes individuals more likely to report feeling regret over their spending and savings
decisions.¹⁶ Note that only 28% of those offered SEED took up, and of those only about one-
third regularly used the account.¹⁷ Hence it follows that although SEED helped 10% of the
treatment group save more (and generate an overall positive intent-to-treat effect), the mere offer
of the SEED account generated, on average, a feeling of remorse. Perhaps those who did not take
up and use felt remorse, and those who did take up and use did not feel remorse, but the average
effect is an increase in remorse because of the relative size of these two groups. Perhaps a second
marketing would have been more successful than the first, if the first offer made individuals more
aware of their inability to save as much as they would like.

IV. Conclusion

Even when husbands appropriate their wives’ loans, microcredit is thought to empower
women in household decision making processes (Mizan 1993). Policymakers frequently cite
these arguments as a key motivation for targeting microfinance and microsavings interventions to
women. On the other side, some have argued that microfinance usage and the subsequent need to
repay (e.g., in order to protect her reputation amongst her peers) may subjugate women to the
power of their spouses, hence potentially increasing domestic violence (Rahman 1999). Evidence
(albeit weak) points both ways, and naturally may depend largely on the region-specific economic

¹⁶ Interestingly, agreeing with this statement is also correlated with being time-inconsistent when answering
hypothetical time preference questions.

¹⁷ Appendix Table 1 shows that about half of the individuals who have not withdrawn their funds never
actually used the account beyond the initial account opening deposit..

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