Financial inclusion strategies for slum households: insights from a conjoint analysis

Slum dwellers continue to face exclusion from mainstream social, economic, and financial activities because of their lack of education and low income, leaving them vulnerable to income shocks and persistent poverty. The absence of empowerment compounds challenges and highlights the urgent need to address their financial inclusion. Designing an inclusive deposit product is imperative to ensure the financial inclusion of slum dwellers. We conducted a randomized conjoint experiment gathering 2500 choice responses from 250 respondents in slum households in Khulna, an industrial city in Bangladesh. Our study estimates the influence of each attribute on slum dwellers’ choice of deposit products, measures willingness to pay for the proposed inclusive deposit product, identifies heterogeneity in their preferences, and examines the impact of financial literacy on their preferences. Our hypothetical financial inclusion product provides valuable insights for policymakers when formulating comprehensive policies to ensure the financial inclusion of slum dwellers.