In March of this year, UNCDF Tanzania conducted a scoping mission in Nyarugusu Refugee Camp to assess barriers to refugees' economic empowerment. Ultimately, it became clear that access to finance was a major challenge, but that UNCDF could develop a program that would complement existing livelihoods programming and help the refugee population become more empowered, independent, and resilient.
As of August 2017, Nyarugusu Refugee Camp held 144,000 people—making it the largest refugee camp in Tanzania, and the third largest in the world. Nearly 72,000 Congolese and 67,000 Burundians now live in the camps, many who have been there since the camp was established in 1997. In Tanzania, refugees face many limitations, but the biggest challenge is access to capital—refugees are not allowed to leave beyond a 4km perimeter of the camps, and they cannot seek full employment. As such, two main opportunities exist for refugees to earn money: work as an incentive worker for an NGO or government agency, or buy and sell goods or services inside the camp or on the newly established common market accessible to both the refugees and the host community.
The extra income refugees earn from their entrepreneurial endeavors or incentive work can range anywhere from a few cents to $20 dollars a month, and is often used to buy extra food, clothes, shoes, house tools, children's school supplies, and phone credit. That said, many refugees still don't know how or where to save what little money they have. Since only 16.7% of Tanzanians have or use banking services, it was unsurprising that few refugees had access to formal financial services. But given that Tanzania has a well-established environment for savings groups and one of the most robust mobile money markets in the world, UNCDF sees an opportunity to improve refugees' economic livelihoods through alternative delivery channels such as mobile money, savings groups, and financial education with the long-term goal of linking refugees to the formal financial sector.
This week, UNCDF is launching a pilot program in Nyarugusu Refugee Camp that will enhance refugees' access to financial and digital education and capital through the expansion of savings groups with support from Good Neighbours Tanzania, while leveraging our network of specialists in financial and digital literacy to build refugees' financial capability using sms and tablet-based delivery (developed and implemented by our technical partners MicroSave, Arifu, and Fundación Capital).
The pilot was inspired by UNCDF's MicroLead program, in which Financial Service Provider partners have developed and built linkages with informal savings groups in Africa, reaching 900,000 group members with formal financial services in four years. It is also part of the United Nations Joint Programme in Kigoma, which involves 16 different UN agencies and focuses on improving development and human security for both host population and refugees in the region. Specifically, UNCDF will be working with UNHCR, UNDP, ILO, ITC, and UN Women on the theme of youth and women's economic empowerment.
Building off of experiences and lessons learned under the MicroLead Program, the Nyarugusu pilot will provide targeted trainings, products, and services for both women and youth, since these groups are often among the most vulnerable. At the launch, UNCDF is convening a meeting with implementing partners on both financial education/digital literacy and savings group formation and strengthening. In the coming weeks, UNCDF will partner with an implementing NGO to deliver a three- to five-day workshop that trains saving group leaders on proper savings groups methodologies to ensure consistency between groups.
Between now and April 2018, UNCDF and Good Neighbors Tanzania will form 100 new savings groups and strengthen an additional existing 20 groups, applying lessons learned from the best practices workshop held for savings group leaders later this month. Keep checking back for exciting updates on this new project! We will be posting our progress on the UNCDF website and Twitter.
By Sarah Stillman
For more information, please contact: Sarah Stillman, UNCDF Program Development Intern, Tanzania at sarah.stillman@uncdf.org
Posted by: kweiss2001@gmail.com
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