Institute for Money, Technology & Financial Inclusion

This paper examines the various practices used to achieve income and consumption smoothing amongst the poorest households in Yogyakarta, Indonesia. It looks at selected 125 households, representing 25 households in each of the five regions of the Yogyakarta area. It designated how rural financial institution and other can help them to have better smoothing strategy. We found that the behaviour varies in response to the types of profession and gender. Furthermore, the source of the income fluctuation also matters in determining households’ responses. However, the source of the consumption fluctuation did not appear to differ across professions.