Assessing the Economic Resilience of Ugandan Households Before COVID
Uganda’s informal sector driven by trade, hotels, restaurants, manufacturing and agriculture – which forms the primary source of livelihoods for about 3 million households and has a high number of inter-linkages across the economy. It continues to play a crucial role in creating employment and income opportunities for a majority of Ugandans. Access to the right financial products and services is key to helping people recover from financial shocks such as the COVID-19 pandemic and building their longer-term economic resilience.
Financial Sector Deepening (FSD) Uganda in partnership with the Ministry of Finance, Planning and Economic Development (MoFPED) launched a survey to assess the economic resilience of Ugandans prior to the first reported case of COVID. The report provided several highlights including:
- Nearly half the adults in Uganda cannot sustain their lifestyle after only one day of lockdown – by day 20 of a lockdown less than 20% can sustain their lifestyle.
- It is likely that 23% of Ugandans who receive their income daily or irregularly, and who could not work due to travel restrictions or the effects of the economic crisis experienced a 100% loss in income.
- Only 10% of Ugandans use banks as their primary financial service provider, with 40% of the poorest and 47% of middle-income earners relying on savings groups.
Findings from the research will provide policy makers, regulators and other financial market actors with the evidence they need to inform inclusive economic recovery responses going forward. Insights will also enable market actors to adopt strategies that will also meet the needs of the underserved and inform FSD Uganda’s programmatic response to COVID-19.