The Leaky Bucket: Transition costs from cash to deposits in a Mexican transfer program

The study highlights the significant costs of transitioning from cash to deposits for social transfer’s beneficiaries, especially in areas with limited financial access. Conducted through a randomized controlled trial involving 150 communities in Hidalgo, the research concludes that beneficiaries who switched to deposits faced higher costs and a reduced likelihood of receiving the full social transfer amount, probably due to fees. They also reported feeling less safe when accessing their funds. The studies highlights issues that must be carefully considered when designing transitions from cash to digital payments.

• Date: 01/10/2024
• Author(s): Fernanda Marquez-Padilla, Susan W. Parker
• Sector: Any
• Topics: Digital technology, Inclusive finance
• Regions: Americas
• Resource type: Publications
• Institutions: The University of Chicago