Abstract (EN)

We investigate, in this paper, to which extent the socio-economic status of rural Rwandans determines participation in informal groups offering financial services. We exploit first-hand individual survey data from two Eastern districts in Rwanda including rich information on group membership and group member characteristics. Our goal is to explore whether membership in these informal groups is restricted to better-of households. We observe that it is crucial to distinguish groups by type of services offered. While asset-poor households are less likely to be members of groups offering credit and savings services, a reverse tendency is observed for groups offering insurance services. In addition, the analysis finds that poor are also disproportionately excluded from formal and informal financial alternatives to groups. Finally, public intervention, though very carefully implemented in the country, is not sufficient to provide social protection to the bottom poor. Nevertheless, a key finding of this study is that public intervention emerges as complementing decentralized access to financial services. In other words, Rwandan public funds mostly benefit the otherwise-excluded poor.