By Silvia Nyambura
Uganda’s Gross National Savings to Gross Domestic Product (GDP) rate in 2015 stood at 13.3%. This is against Tanzania’s 22.6%, Kenya’s 15.9% and Rwanda’s 11.2%. Experts believe, the reason this rate appears low is not because Ugandan’s do not save but rather they save in unconventional methods.
According to Japheth Katto the Chairman Stanbic Bank, Ugandans prefer to save in non-monetary terms. This he attributed to complex processes by financial institutions as well as lack of financial literacy.
“Saving is keeping something away for future use. Its formula should be income less savings instead of the common income less expenditure. Many Ugandans however do not save because the know nothing about it. In addition, the processes involved to get set up with formal financial institutions had previously been complicated with too many requirements. While major milestones have been achieved to solve such issues, I believe financial institutions should continue to engage with the public to educate them on benefits of long term saving,
