UNSGSA -UN Secretary-General’s Special Advocate for Inclusive Finance for Development

Savings accounts make a huge difference for women and families

Access to diverse financial services, especially savings, that meet the needs of low-income clients is at the core of financial inclusion, and is one of the focus areas targeted by the UNSGSA.

A study in Uganda found that poor households lost, on average, about 20% of their money when saving only through risky, expensive informal means, such as storing cash at home or buying livestock. Research indicates that when given access to formal financial services, however, households and businesses were able to save and invest more.

Effects of access to safe places to save are especially important for women, for whom there are often higher barriers to savings and investment. Nepalese women who gained access to savings accounts increased their monetary assets by more than 50%, non-monetary assets such as livestock by up to 15%, and household investments in health and education over one year. Market women in Kenya were similarly able to save more. In as little as six months, they increased daily investment in their businesses by up to 56% and private expenditures by 37%. These women with savings accounts were less likely to draw down on working capital or stop work in response to health shocks like malaria.

By showing the existing need for, and impact of, well designed savings products, studies such as these are helping to inspire policy makers and financial institutions to expand tailored savings accounts for low-income clients in many parts of the world.