Uganda | MicroLead
In the past, microfinance institutions (MFIs) have focused largely on providing loans to their clients. However, MFIs are often criticized for their high interest rates and lack of other financial services such as savings accounts or insurance. Local governments, MFIs and not for profit organizations like MEDA are working to establish a set of microfinance best practices including the regulation of some MFIs as deposit-taking institutions. The benefits of this are two-fold: clients have a safe place to save their money and are offered reduced interest rates on loans.
MEDA's financial services team works with UGAFODE Microfinance Limited, one of only four regulated MFIs in Uganda, to provide a safe and regulated savings environment for their clients. MEDA guides UGAFODE on how to best reach rural savers through informal savings groups and by utilizing mobile technology.
The cost of delivery to rural clients is often the main barrier to financial inclusion in Uganda, and MEDA plans to reduce this cost through mobile banking and partnerships with already established community-based organizations that reach savings groups.
In this project, MEDA and the ground-breaking design research firm, IDEO.org conducted field research to uncover the financial needs and aspirations of the unbanked in Uganda. The project also works with a social marketing firm, 17 Triggers, to determine how to best attract, serve and sustainably provide financial education and services to UGAFODE clients.
The result of these multiple partnerships will be to increase access to innovative savings products, including mobile financial products and services, for 80,000 clients in Uganda. MEDA will also use their expertise working with women and rural populations to help UGAFODE increase access to financial services for these often neglected populations.
Project Quick Facts
Goal – expand UGAFODE's outreach to serve more women and rural savers utilizing savings groups and technology
Reach – 80,000 clients
Funding – UNCDF (United Nations Development Capital Fund)
Duration – June 2013 - March 2017