Mobilizing Savings - Key Issues and Good Practices in Savings Promotion

This publication provides an overview of the needs and demands of low income households for savings services, savings mobilization from the perspective of a financial institution and the regulatory financial authorities in developing and transition countries. The publication:

• Provides insights of low income households' monetary and in-kind saving habits, investment decisions and liquidity management;
• Summarizes potentials and risks for the institutions providing savings services to its clients and members;
• Acquaints its readers with micro finance institutions that already offer savings services in different countries;
• Enhances the need to analyze the potential demand and the existing offer from competitors before designing and implementing new service;
• Presents important aspects related to macro economic conditions and regulatory framework in which savings mobilization takes place.

Some of the conclusions and recommendations that the publication presents are:

• The security and accessibility of deposits are key factors to attract low income households to a savings institution;
• Institutions should proceed stepwise and professionally when introducing savings services, analyzing the existing offers and the potential demand of their client;
• A combination of self-regulation and delegated supervision by an accredited auditor can represent an interesting alternative for MFIs who wish to become regulated, when financial authorities have neither the capacity nor the political will to do it themselves.