ECIAfrica

Projects

Improving access to finance to drive economic growth in rural areas and alleviate poverty

The microfinance industry in Uganda is dynamic and undergoing significant change in terms of increasing professionalism and outreach. Rapid growth combined with a plethora of institutions and donors has resulted in a sector that while dynamic, falls short in terms of improving levels of national outreach. Over the past decade, the Government of Uganda has taken many steps to strengthen the ability of the financial sector to meet the growing needs of Ugandan entrepreneurs and micro, small, and medium-sized enterprises. These include efforts to improve the mobilisation and allocation of financial resources and foster monetary deepening by liberalising interest rate policies and improving the formulation and execution of monetary policy.

A first phase of reforms focused on improving the regulatory environment for financial institutions through the passage of new banking legislation, restructuring and privatising weak financial institutions, and building the capacity of oversight authorities. The second phase focused on further deepening and developing the financial sector and microfinance institutions (MFIs).

To support such reforms and strengthen access to finance, ECIAfrica managed and implemented the multiyear FSDU programme. FSDU strengthened the capacity of various financial institutions, and improved the transparency, professionalism, and management of savings and credit cooperatives. The programme supported the launch of the Post Bank mobile banking service and assisted four microfinance institutions to comply with legislative requirements and transformation and restructuring activities. FSDU was also instrumental in the expansion of the popular accumulated savings and loans associations working with CARE and other local partners. A total of 3,681 associations were formed with membership of more than 84,000 of which 70 percent were women. Of these associations, 276 graduated from the programme and no longer needed outside assistance.

FSDU's most acclaimed effort was the development and implementation of a nationwide consumer education programme. This included radio, print media, music, dance, and drama campaigns in English and local languages. It was widely recognized and applauded for the interest and influence it achieved.

Uganda

September 2002 - August 2007

Client:

U.K. Department for International Development

Contact:

Christopher Chikonyora

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