FinScope 2018: Topline Findings June 2018
Content 1. FinScope Objectives and Methodology 2. Demographics and Financial Inclusion Enablers 3. Financial Inclusion and Services Uptake 4. Financial Attitudes & Capabilities 5. Financial Strategies 6. Conclusion
Content 1. FinScope Objectives and Methodology 2. Demographics and Financial Inclusion Enablers 3. Financial Inclusion and Services Uptake 4. Financial Attitudes & Capabilities 5. Financial Strategies 6. Conclusion
FinScope 2018 Objectives • To track overall trends in financial inclusion to provide information on how the landscape of inclusion has changed since 2009, including benchmarking these trends with peer countries within the region • To provide insights into what can be done at both the policy and market levels to increase financial inclusion further – Drivers of; and barriers to inclusion
Methodology comparative with other FinScope surveys 3 stage sampling – Step 1 – EA sampling (UBoS) • 320 EA selected – achieved 316 – Step 2 – Household listing (Ipsos) • 10 HH per EA – achieved 3002 interviews (94% response rate) – Step 3 – Individuals >= 16 years • 1 individual selected per selected HH Weighting & Validation (UBoS)
Content 1. FinScope Objectives and Methodology 2. Demographics and Financial Inclusion Enablers 3. Financial Inclusion and Services Uptake 4. Financial Attitudes & Capabilities 5. Financial Strategies 6. Conclusion
Demographics 18.6 MN 38.8 MN Total Population of Uganda Adult population, 16 years and older
76% of adults reside in rural areas Rural-Urban distribution Urban 24% Rural 76%
Adult population is female skewed Male, 46% Female, 54%
58% of adults are younger than 35 years % of adults 16 t o 25 y ears 32% 26 t o 35 Ye ars 26% 36 t o 45 y ears 17% 46 t o 55 y ears 11% 55 t o 65 y ears 9% olde r tha n 65 y ears 5%
70% of adults have not achieved secondary levels of education Tertiary 1% Spe cia lize d tra ining 5% Se conda ry leve ls 24% Primary level s 55% N ever w ent to school 15% % of adults
Financial Inclusion Enablers
52% of adults own mobile phones and rural adults less likely to have digital connectivity % of adults 52% Mobil e ph one o wne r ship 46% 70% 4% Com puter ac cess 2% 12% % of adults 10% % of rura l adults Interne t acc ess 5% % of urban ad ults 25%
Less than 20% of adults meet stringent KYC requirements % of adults 84% ID 84% 85% 15% Reside nce 13% 25% % of adults 14% % of rura l adults KYC (Both) 11% % of urban ad ults 22%
Content 1. FinScope Objectives and Methodology 2. Demographics and Financial Inclusion Enablers 3. Financial Inclusion and Services Uptake 4. Financial Attitudes & Capabilities 5. Financial Strategies 6. Conclusion
78% of Ugandan adults are financially included All a dults 78% 22% Males 78% 22% Fe males 77% 23% Rural 75% 25% U rb an 86% 14% % adults incl uded % adults exc luded
Financial Access Strand All a dults 22% 36% 20% 22% Male 24% 39% 15% 22% Fe male 20% 34% 23% 23% Rural 18% 34% 23% 25% U rb an 35% 41% 10% 14% Have or use formal servic es only Have or use formal AN D informal servic es U se only inform al servic es Do not use a ny servic es Formal services – provided by FSPs that are regulated Informal services – provided by providers who are not regulated
Financial Services Uptake
Measurement framework: Financial services uptake Do Ugandans use financial services to manage their financial lives? Yes No What are the drivers What are the of uptake barriers? Payment service Saving service Formal providers Uptake Credit service Uptake refers to opening an Informal providers account with a service provider Insurance service or using someone else’s account
Saving Strand All a dults 13% 5% 22% 13% 47% Male 16% 6% 17% 14% 46% Fe male 10% 5% 26% 12% 48% Rural 5% 9% 24% 13% 49% U rb an 27% 7% 14% 12% 40% U sed form al savin gs mech anisms o nly U sed both formal a nd informal sav ings mec hani sms Relie d on in f o rma l saving s m echa nism s Relie d only on self for saving Didn’t save
54% of Ugandan adults save. Main savings mechanisms include: % of savers Sa ving s g r ou p/VS LA 43% Kee p c ash at hom e and not using it for ev eryda y li ving 27% ex penses Mobil e ph one 23% Bank /MDI 12% RO SCA/merry-go -r ou nd 9% Give to a h ousehold or famil y me mber/ friend t o ke ep safe 8% SACC O 5% Anothe r comm unity group or c hurc h 2%
Credit Strand All a dults 4% 22% 19% 54% Males 4% 20% 24% 51% Fe males 4% 23% 15% 57% Rural 3% 24% 20% 52% U rb an 7% 14% 18% 60% U sed only f o rma l lend ers U sed form al and informal l enders U sed only informal le nders Relie d on fam ily a nd friends Didnt borrow
46% of adults borrow. Lenders used include: % of borrowers Fa mily /friend s 53% Sa ving s g r ou p/VS LA 46% SACC O 3% Bank 3% MFI 2% Mobil e mo ney se r v ice prov ider 2% Burial so cie t y 2% O t h er 1% Mone yle nder 1% Credi t inst i t u t i on 1%
Insurance Strand All a dults 1% 40% 59% Males 2% 37% 61% Fe males 1% 42% 57% Rural 43% 57% U rb an 2% 32% 66% Have form al insuranc e Rely on informa l insura nce only N o insurance
Only 1.2% adults are insured. Types of formal insurance include: % of insured Health insurance 51% L oan protec tion 14% L ife insuranc e 10% Motor c omprehe nsive 7% Vehi cle third pa r ty 6% Tradi ng goo ds insurance 4% Crop/liv est o ck insuranc e 0%
Digital Payment Strand All a dults 57% 43% Male 62% 38% Fe male 53% 47% Rural 51% 49% U rb an 76% 24% Have /U se digital payme nt mec hanism U se cash onl y
Uptake and usage of digital payment systems % of adults O wn a digi t a l ac cou nt 44% Rem itt a nce s 51% Pay ing fo r goods and se r v ic es 28% Bill pay ments 6%
Drivers of formal financial inclusion in Uganda % of adults Mobile money se rv ice providers 56% Comme rc ial banks/MDIs 11% SACCO s 5% Pensions 2% MFIs/mi crolende rs 2% 11% adults are served by the banking Insurance 1% sector Coope ra t iv es 1% 57% adults served by the non-bank Capi t a l marke t s 0% formal sector
Banking sector – provider of digital payment and saving services % of clients who use services provided Paymen t services 40% 52% Insuranc e services Saving se rvices 11% Credit services
Non-bank formal sector - provider of digital payment services % of clients who use services provided Paymen t services 89% 1% 13% Insuranc e services Saving se rvices 3% Credit services
Drivers of informal financial inclusion in Uganda % of adults SGs/VSL As 37% Sho p credit 25% RO SCAs 12% Burial soc ieties 14% Money lende rs 2%
Informal sector - provider of saving, credit and insurance services % of clients who use services provided Pay ment servic es Insurance se rv ice s Sa ving servi ces 62% 90% 71% Credit servic es
Reported drivers of uptake per provider Provider Main Driver Secondary Driver Banks To save Process salaries/wages MFIs To get credit To save SACCOS To save/buy shares Turn to them when in financial need Mobile money Had to receive money Had to send money operators VSLAs/groups Save/to get lump sum Turn to them when in financial need Money lenders Quick access to money Proximity
Perceived barriers to uptake per provider Provider Main barrier Secondary Barrier Banks Insufficient money to justify Proximity MFIs Insufficient money to justify Awareness SACCOS Awareness None in community Mobile money Haven’t got phone Not many transactions operators Insurance Lack understanding Cannot afford
Content 1. FinScope Objectives and Methodology 2. Demographics and Financial Inclusion Enablers 3. Financial Inclusion and Services Uptake 4. Financial Attitudes & Capabilities 5. Financial Strategies 6. Conclusion
Income / Expenditure • 47% of adults keep track of income and expenditure • 77% claim adjusting their expenditure according to the money they have available Financial Advice Savings Advice • 56% of adults seek financial advice • 36% of savers seek advice about savings • 47 % claim they don’t need advice mechanisms before they decide where • 16% do not want to ask for advise to save Main sources of advice: Advice on Credit • Family & friends – 50% • 16% of borrowers seek advice about • Household members – 42% different lenders before they decide from whom to borrow
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