Transcript Uganda - World Bank

Impact Evaluation Concept Note for Uganda
Financial Education for the
Highly Educated
Global Workshop on
Development Impact Evaluation
in Finance and Private Sector
Rio de Janeiro, June 6-10, 2011
Intervention Summary


From 2003-2008, more than 4000 Ugandans
lost their savings in get rich quick schemes
that included pyramid schemes, gift circles
etc…
What was surprising is that among these,
more than 45% of those affected were highly
educated people who included doctors,
engineers, architects, government ministers
etc…
Evidence of the Problem
Evidence Cont’d…
Pyramid Schemes:
 It is estimated that more than 4,114 people
fell victim to pyramid schemes of money
lending companies such as Dutch
International, COWE, TEEM limited – Jinja
and many others.
 The amount of cash lost was estimated to be
more than UGX.11 billion. (Uganda Crime
Report 2008) (0.04% of GDP)
Cause of the Problem


The Ugandan Education system is designed in
such a way that a person can go through primary,
secondary and tertiary school levels without
having come across financial education concepts
such as banking, loan management, insurance ,
investment, financial planning and budgeting
unless one specifically chose commerce or
economics as subject options.
For example, a doctor can graduate from medical
school and open a highly successful practice
without any skills in personal financial
Why the Intervention?
The various Financial Education programmes in the
country currently being undertaken target the poor
to the exclusion of the highly educated
professionals.
 Highly educated professionals earn high incomes
and, therefore, have very high potential to save and
invest into the economy.
 The economy is deprived of the trickle down effect
that would have occurred through their savings and
investments.

Proposed Interventions
Financial literacy clinics, which involve talks on:
Value of saving – Current savings and Savings for
retirement
Investment options – Short and long term
investments
DVD and interactive sessions
Website of resources for financial planning
 Post Bank Bond – Fully Government guaranteed
product offering with attractive returns, similar to
Kiva, investments will be used to finance MFI loans
through the Post Bank (and advertised as such)

Methodology
Selection Criteria

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Stratify the highly educated population by
profession, gender and income level and
institution/location e.g. hospital or university
Randomize within strata at the individual
level.
Introduce 2X2 intervention independent of
each other.
Evaluation Questions

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What is the impact of financial literacy training
on saving behaviour among professionals (e.g.
long term savings like pensions)
Does financial literacy training lead to prudent
investment behaviour?
Does financial literacy training lead to adoption
of the new investment product? (Post Bank
Bond)
Does financial literacy training increase the
range of investment products undertaken by
professionals?
Timeline
Team and Staffing

Partnership between the World Bank, Finlit
Foundation and the Bank of Uganda.
Budget

We shall apply for funding from the various
sources including the World Bank Russia Trust
Fund on Financial Literacy.

World Bank Second Private Sector
Competitiveness Project (PSCP II) for
financial markets development in Uganda.