Savings and need in East Africa: an infinite variety
The poor save for a variety of reasons, most of which have underlying risk protection and risk management dimensions. This paper provides an overview of the risk factors – life-cycle risks, structural risks and crisis risks – facing the poor in East Africa. It then goes on to explore the informal savings mechanisms that are already available to the poor, identifying what makes them popular and suitable for particular events or crises, and what are their limitations. Finally, this paper explores various ideas for proposed products – including university bonds, a home ownership savings account and a general emergency loan – that can be designed and offered to the poor to address the risks they face.