Resisting Social Pressure in the Household Using Mobile Money: Experimental Evidence on Microenterprise Investment in Uganda

I examine whether changing the form of disbursement of a microfinance loan enables female microfinance borrowers to overcome intra-household sharing pressure and grow their businesses. Using a field experiment with 3,000 borrowers in Uganda, I compare the disbursement of a loan as cash to disbursement onto a digital account. After 8 months, women who received their microfinance loan on the digital account had 11 percent higher (US$70) business capital and 15 percent higher (US$18) profits compared to those who received their loan as cash. Impacts were greatest for women who experienced pressure to share money with others in the household at baseline. (JEL C93, D13, G51, J16, O12, O16)