Abstract
The paper summarises the results of a research on financial intermediation and savings mobilization undertaken in Ethiopia in mid-80s. It examines firstly financial system reforms brought about by the Ethiopian socialist regime with the focus on institutional changes and finds out that restructured formal financial sector proved to be inadequate in promoting and mobilizing household savings. On the other hand, the informal financial sector has shown itself to be much more successful in this task. Therefore the paper concentrates on the analysis of the informal financial sector and explores actual interlinkages between formal and informal financial circuits. The conclusion suggests feasible actions to be undertaken by authorities with the aim of improving financial intermediation and household savings mobilization
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