Sustainable Transformation of the Financial Sector in Eastern Africa through Institutional Strengthening of the Microfinance Sector and Socio-ecological Transformation of the Economy with a Focus on Rural Development.
We promote rural development in Eastern Africa through financial inclusion
In July 2023, the regional project “Vocational and Commercial Education for the Microfinance Sector in Eastern Africa” was merged with “Rural Development through Institutional Strengthening” to create a new regional project “Sustainable Transformation of the Financial Sector in Eastern Africa through Institutional Strengthening and Socio-ecological Transformation focused on Rural Development.”
The overall objective of this regional project is to contribute to permanent, inclusive, and sustainable economic growth in Eastern Africa, aligned with the Sustainable Development Goal 8 (SDG8: Decent Work and Economic Growth). However, the project also contributes to other SDGs.
The project's activities aim to support the sustainable transformation of the financial sector in Ethiopia, Kenya, Rwanda, Tanzania, and Uganda. Through institutional professionalization of microfinance umbrella organizations, Microfinance Institutions (MFIs) and Savings and Credit Cooperatives (SACCOs), German Sparkassenstiftung Eastern Africa (DSIK) creates prerequisites to offer banking and financial services adequately and sustainably. Thereby, MFIs and SACCOs operate more efficiently and can expand their ranges of services which ultimately contributes to higher financial inclusion.
Particularly, it is achieved through management consulting, support of partner organizations in the fields of strategic and business planning and comprehensive capacity development measures. Furthermore, DSIK supports partner organizations in the introduction of “Shared Services”, for example consistent banking software or external audits. Our advisory services focus particularly on improving our partner organizations’ financial autonomy.
One main project focus is on digitalization. In recent years, mobile banking solutions and cashless payments have experienced rapid growth rates in Eastern Africa. Therefore, it is increasingly important to accompany these developments with targeted advice and training measures as well as with new product development.
Additionally, the project aims to enhance financial inclusion among populations living in poverty in Eastern Africa by establishing a permanent, high-quality educational offers for the microfinance sector. This includes improving the advisory services and management of MFIs and SACCOs, and empowering end beneficiaries such as farmers, micro, small, and medium enterprises (MSMEs), and the poorest segments of the population, to better understand and utilize financial products, thereby strengthening their economic resilience.
In Rwanda, one major component is the professionalization and consolidation of Umurenge SACCOs and the establishment of a Cooperative Bank, in close collaboration with partner organizations and relevant stakeholders.
This regional project is sponsored by the German Federal Ministry for Economic Cooperation and Development (BMZ). The project was successfully completed in Burundi in September 2024.
If you would like to learn more about our on-going efforts in Ethiopia, Kenya, Rwanda, Tanzania and Uganda, please have a look at our “Activities” section.
