More often than not, financial institutions have continued to encourage more people to adopt the savings culture as a way to not only grow their assets but also plan for uncertainties that could arise.
However, what does not come out clearly is that saving is not just about keeping money on the side but rather planning on what one intends to use it for and after what period.
According to Jonan Kisakye, the CEO Uganda Insurers Association (UIA), the message of saving should be preached under four pillars of target, strategy, teamwork and accountability.
He was speaking during the handover of the savings piggy bank to the Insurance Regulatory Authority (IRA) under the Bank of Uganda Financial Literacy campaign aiming to boost saving culture amongst Ugandans.
“The challenge for us was the transparency of the savings box, every day you enter the office and see how empty it is. You feel challenged to drop in some notes. There was a need for teamwork and strategy on how to collect money.
We were able to save over 2.2 million shillings, so we are now handing over the mantle to the industry regulator with the hope that they will surpass the target.”
He challenged other entities yet to receive the savings piggy bank to build capacity to be able to sustain and support such initiatives, not necessarily by capital, but by following up to ensure that indeed, they're succeeding because of their sacrifice.
Addressing stakeholders shortly after receiving the savings bank, Sande Protazio, Director Planning, Research & Market Development IRA, noted that the regulator will mobilize more people to save towards the cause.
He commended the Bank for Uganda Financial Literacy Department for establishing such an initiative.
“This looks like a small thing, but to me it looks like a bigger thing that can cause transformation. Probably there is something that we need to do and things like these can help us improve the savings culture amongst Ugandans.
When you look at the savings to GDP ratio for most countries, China is at 44.9%, Nigeria 33.9%, South Africa 16%, Kenya 16%, Rwanda 15% and Uganda approximately 9% which is way below the bar.”
According to the Bank of Uganda annual report for the period ended June 2021, the number of Ugandans who save declined from 18.1 per cent in 2019 to 16.3 percent.
The reduction was mainly driven by a decline in economic performance, which affected key sectors of the economy, thus leading to a weak external demand position reflected by a negative contribution from net exports and negative growth in private investments.
According to Tilda Nabbanja the Bank of Uganda Team Leader, Financial Literacy, the insurance sub-sector has evolved over the years and it has come up with interesting saving mechanisms which can be tapped into to boost the drive.
The savings piggy bank which has been through 4 institutions has now raised over 6 million shilling. The overall goal is to save as much money as possible with the grand total to be disclosed on October 31st during the World Savings Day celebrations.
Source: The New Vision (Click here to view)
