In our own society we struggle with “save for it” versus “borrow it.” This debate becomes much more precarious for the poor. Many Micro-Finance Institutions (MFI’s) are looking at adding and even integrating savings to their lending services.

It will take more than good intentions and a recognition that the poor want places to deposit the money they squirrel away to make microsavings work. Part of the problem with trying to mobilise deposits from poor people is simple economics. It is hard to make a profit from customers who make lots of tiny deposits without massively trimming transaction costs.

…Saving…is often “what didn’t happen”—the accumulation of decisions not to consume. Consumption, by contrast, is an active decision to buy something. One product he is testing in India involves collaborating with banking agents to sell “savings cards” in shops, so that saving becomes an active purchase and can compete with other impulse buys.

via Savings and the poor: A better mattress | The Economist.