MicroSavings in Ugandan Primary Schools | The Abdul Latif Jameel Poverty Action Lab

Researchers:

Dean Karlan

Researchers:

Leigh Linden

Partners:

FINCA Uganda

Fieldwork implemented by:

Innovations for Poverty Action (IPA)

Location:

Eastern Uganda

Sample:

136 schools in Jinja, Iganga, Mayuge, and Luuka districts

Timeline:

2008 - 2013

Themes:

Education

Themes:

Finance & Microfinance

Policy Goals:

Encourage Savings

Policy Issue:

The importance of education is a common refrain in the international development discourse and has inspired campaigns such as the second Millennium Development Goal: to achieve universal primary education. Decreasing primary school dropout rates is one strategy that has been employed to improve education systems. Children drop out for a number of reasons, but financial concerns are often a determining factor. Even when governments finance a significant part of primary education by providing teachers, a curriculum, and buildings, there are still many costs associated with attending school. Providing scholastic materials such as uniforms, pens, pencils, and exercise books may pose a significant challenge for poor families. Furthermore, these families may lack access to formal savings services, which may enable them to set aside money for education and keep it secure. This evaluation assesses the impact of a school-based savings program that aims both to encourage savings for school expenses and to promote financial education.

Context of the Evaluation:

Uganda’s primary school enrollment rates have increased spectacularly as a result of its policy of Universal Primary Education, which has eliminated most, though not all costs of attending school. Enrollment has gone from 3.1 million children in 1996 to more than 8.29 million in 2009. Retaining pupils, however, seems to be a more trying concern, though 94 percent of Ugandan children enroll in primary school, as few as 32 percent complete the final class P7.¹ While the government covers the cost of teachers and schools, more than 40 percent of Ugandans find additional school expenses, like uniforms and supplies, unaffordable.

Details of the Intervention:

Researchers partnered with the Private Education Development Network (PEDN) and FINCA Uganda to implement a savings program in Ugandan government primary schools. The goals of the “Super Savers Program” were: i) to enable pupils and their families to save money for education; ii) to incentivize and financially enable pupils to remain in school; and iii) to engender a culture of savings amongst participating pupils.

During the 2009 scholastic year, PEDN and FINCA piloted the program in eight government primary schools. The positive response to the pilot motivated researchers to scale the program and conduct a randomize evaluation of its impact.

At the end of 2009, after baseline data was collected in 136 schools in Jinja, Iganga, Mayuge, and Luuka Districts, the schools were randomly assigned to a treatment or comparison group. There were 39 schools in each of the two treatment groups and 58 schools in the comparison group. The program was then implemented in treatment schools during the 2010 and 2011 scholastic years (February to November).

On a weekly basis, a Super Savers Program Officer visited each school to assist teachers and pupils with the savings exercise. Pupils’ savings were kept at the school in a safety lock box. At the end of each term, the Super Savers Team, together with FINCA Uganda, collected the savings and deposited the money into each school’s bank account. The Super Savers Team also conducted parent sensitization meetings at each school to teach parents about the program.

At the beginning of each of the year, the Super Savers team returned to each school to distribute savings to individual pupils. In the first treatment group, pupils received their savings in cash and were able to determine how they would like to spend or save the funds. In the second treatment group, pupils received their savings in the form a voucher, which had to be used to make an educationally-related purchase, such as school lunch, exam fees, a uniform, sanitary supplies for girls, or to continue saving. On the day of the savings payout, the Super Savers Team organized a small fair at each school to enable pupils to make these purchases in both cash and voucher treatment groups.

Comparing outcomes within these two treatment groups, in relation to the comparison group, will help to determine if the intervention is effective in reducing drop-out rates and increasing savings levels, scholastic payments and other education outcomes.

The Super Savers Team is now preparing for the 2012 scholastic year, which will be used to determine the sustainability of the program and schools’ abilities to implement it on their own, with little support from the team. This will be used to determine the program’s ability to be scaled and its long-term potential.

Results and Policy Lessons:

Results forthcoming.

1. UNICEF Uganda: http://www.unicef.org/infobycountry/uganda_statistics.html#77

MicroSavings in Ugandan Primary SchoolsPDF version