Understanding the Challenges and Opportunities in Promoting Savings Among Low-Income Individuals in Lesotho, Malawi, and South Africa

This paper seeks to comprehensively document the savings landscape in Lesotho, Malawi, and South Africa in order to understand the challenges and opportunities in promoting savings among low income individuals. It includes an understanding of the various savings mechanisms, both formal and informal, currently used by low income households and identifies barriers, obstacles, and opportunities for greater expansion of savings to these households. The paper also provides a diagnosis of the factors that help and hinder the availability and quality of savings in these countries. It conducts a SWOT analysis for promoting low income savings in each of the three countries. The paper covers the following sections in detail:

• Methodology of the study with a focus on the definition of savings and study approach used;
• Discussion on different aspects of savings such as renaissance of interest and spectrum of savings;
• Current approaches to financial sector development;
• Cross-cutting findings from Lesotho, Malawi, and South Africa with a focus on demand and supply of savings and other macroeconomic factors;
• Case-studies for each of the three countries covering topics such as economic overview, financial sector overview, savings landscape, policy environment and regulation, and recommendations.