Enablers and Inhibitors for Access and Usage of Digital Financial Services in Uganda

Isaac M. B. Shinyekwa, Dablin Mpuuga, Aida K. Nattabi and Enock W. N Bulime

Working Papers from African Economic Research Consortium

Abstract: Financial inclusion (FI) and specifically access to affordable financial services is very critical in reducing poverty, income inequality as highlighted in Sustainable Development Goals 1, 5 and 10; and accelerating economic growth. FI is therefore important for Uganda like any other country. Women and rural Ugandans are proportionately more included in informal financial groups, whereas men and urban dwellers have more access and usage of formal financial services. The low level of formal FI in rural areas is partly explained by the high cost of providing financial services. Commercial banks are faced with lack of the incentives, information, and sometimes the ability to mitigate the risks of operating beyond urban markets or with low-income clients. Consequently, a significant portion of rural and low-income Ugandans remain financially excluded. In this regard, DFS such as MM emerge as one of the ways to bridge the financial access gap between the financially included and excluded. It is however noted that little is known in Ugandas context concerning the critical enablers as well as inhibitors to access and usage of DFS. The policy brief summarizes findings from the study titled, Leveraging Digital Services and Market Development for Financial Inclusion: The Case of Uganda.

Date: 2025
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Note: African Economic Research Consortium
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