OBJECTIVE: Strengthening the capacity of financial institutions
in order to expand the provision of appropriate financial
services, particularly to the rural poor.
DURATION: 5 years
BUDGET: GBP 7.1 million
the Capacity of the Microfinance Sector in Uganda
micro-finance industry in Uganda
continues to grow rapidly in terms of increasing professionalism
and outreach, as well as a changing regulatory environment. The
desired outcome is a transition from an NGO dominated, unsupervised
sector to a regulated and supervised one. This will improve the
quality of financial services in rural areas, particularly by providing
safer savings opportunities to poor and vulnerable people.
order to improve the capacity of Uganda’s financial sector
to meet the financial needs of poor rural and urban households,
micro, small and medium enterprise on a sustainable basis, the UK
government’s Department for International Development (DFID)
established the Financial Sector Deepening Uganda (FSDU) programme
and contracted ECIAfrica
Consulting (Pty) Ltd. to manage it.
five year, £7.1m FSDU programme officially started in August 2001.
The project was due to finish in July 2006 but was extended to 15th
September 2007. FSDU’s goal is to generate sustainable improvements
in the livelihoods of poor households through reduced vulnerability
to shocks, increased incomes and employment creation. Its purpose
is to deepen the capacity of Uganda’s
financial sector to meet the financial needs of poor rural and urban
households, micro, small and medium enterprises on a sustainable
activities in the years 2004 to 2007 can be found in the respective
Annual Reports following the links below.
objectives and design of the project have evolved along with the
evolution of the microfinance sector in Uganda.
These changes reflect a better understanding of what is wanted and
needed to bring a full range of financial services to more Ugandans,
and also to complement and fill in gaps in the wide range of support
already being offered by other actors.
July 2004, DFID and FSDU (ECIAfrica) drafted a new logical
framework, under which the project has five outputs, namely
Better Informed and Protected Consumers;
Improved Monitoring, Supervision and Regulation of Tier 4 MFIs
Improved Product Delivery and Development;
Development of a “Top end” sector characterized by a
smaller number of large regulated financial institutions serving
the needs of poor clients;
Increased dissemination of relevant information to Micro-finance
Policymakers and Practitioners