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ILO - Social Finance Brief: UGAFODE’s journey in serving refugees and host communities, in Uganda - January 2022

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About this publication

The ILO documented the journey of few financial services providers (FSPs). The cases describe the actual decisionmaking process inside the FSPs as it evolves through the various “stages” of the journey to become inclusive of refugees and host communities. In each one of the cases, we focus on one or more of the stages (identified by the sections’ titles) where the FSP think it has a good ‘’lesson learnt’’ for the global FSPs community with regard to the outreach strategy design and implementation.

Key points

  • Initially, risks are perceived to be high, but deeply understanding the refugee market helped UGAFODE to build buy-in and spur the mind-set change.

  • Like most FSPs expanding services to refugees, UGAFODE reviewed and adjusted policies, systems and documentation, but existing financial products were already well suited to many refugees.

  • Recruiting refugees increased UGAFODE’s outreach.

  • Segmentation and clear differentiation from NGOs are important for FSPs. NGOs partners referred prospective clients, but UGAFODE retained final loan appraisal in-house, ensuring new clients understood that FSP services are not “for free.” - Refugee customers perform as well or better than nationals. UGAFODE has learned that not all refugees are great clients, but most refugee borrowers perform at least as well as nationals.