2025/07/14 by SAMRAWIT DESSALE
paper · doi:10.20372/nadre:8548
ABSTRACT This study investigated the factors affecting household’s savings: The case of woldia town, Amhara national regional state, Ethiopia. The objective of this study was to identify factors affecting household savings. A total of 397 sample households were selected through simple random sampling in Woldia town, North Wollo zone, and the Amhara regional state of Ethiopia in the years 2023–24. To identify the determinants of the decision to save and the extent of saving, a double hurdle model was used. On top of the econometric models, we also analysed descriptive and inferential statistics to describe different demographic, socioeconomic and other characteristics of sample households. The descriptive result showed that about 66 present of sampled households are saver from formal financial institutions. Accordingly, the outcome of the probit regression model Age, sex, education, income, extension contact, credit access, value of asset, expenditure, and marital status were significant determinant factors for the household’s decision to save at formal financial institutions. Accordingly, the outcome of the truncated regression model shows that sex, age, marital status, credit access, value of asset, income, expenditure, local leadership, dependency ratio, and family number were significantly affecting the extent or amount of saving. The findings implied the need for households to design strategies that could improve saving behaviour, mobilization, and diversification of income. Moreover, the need for government involvement in building the capacity of households in terms of education and information systems with regards to savings as well as encouraging financial institutions to implement door-to-door service provisions so as to enhance saving behaviour of households are desirable.