SAVINGS GROUPS FOR REFUGEES

“South Sudan has been shattered and we have fled our home. I am here alone with my children but coming to join a savings group like this takes away the stress and encourages me to forget the pain. I believe it is not good to beg. God has given me hands and brain to think. I use my hands to make what I need to be independent. God has helped me to trust Him and I am really blessed by the Seed Effect group I’m in.” – Pascalina, Seed Effect group member

There is a reluctance to bring development focused financial interventions to refugee contexts. Generally, this reluctance is based on beliefs that refugees are too transient, will only be refugees for a short time, do not have or cannot generate incomes, and are too risky as a people group to invest in. In short, this boils down to a belief that when compared to a native population, even an impoverished one, a refugee population isn’t capable and is just too dificult to engage with an economic development intervention. There’s a belief that it won’t work.

In their book, Refuge: Rethinking Refugee Policy in a Changing World, Alexander Betts and Paul Collier note that 54% of the world’s 21.3 million refugees are in protracted refugee situations and are “often denied access to the right to work or to freedom of movement”. They further state that “the UNHCR is responsible for refugees in thirty-two separate protracted refugee situations around the world, with an average length of exile of twenty-six years.”

Betts and Collier’s research makes clear that refugee crises are rarely short term. But what about the belief that refugees aren’t capable and that development focused financial interventions won’t work?

“The current system for refugees who remain in their region of origin is a disaster. It is premised upon an almost exclusively ‘humanitarian’ response. A system designed for the emergency phase — to offer an immediate lifeline — ends up enduring year after year, sometimes for a decade. External provision of food, clothing, and shelter is absolutely essential in the aftermath of having to run for your life. But over time, if it is provided as a substitute for access to jobs, education, and other opportunities, humanitarian aid soon undermines human dignity and autonomy.” – Betts and Collier, Refuge: Rethinking Refugee Policy in a Changing World

Unlike the widespread system referenced above, Uganda is unique. It’s one of the only host countries that offers refugees the right to work and the right to movement. Seed Effect’s work in Uganda has given us the opportunity to bring a Christ-centered, savings-led microfinance program to both South Sudanese refugee populations and host Ugandan populations living side by side and compare the results. While one might expect to see vastly different utilization and impact, we have found the opposite. We have found that the refugee population we serve not only has great need, but has successfully saved, invested and payed back small loans, and been equipped to provide for their families with dignity, overall making great use of our program.

After three years of serving refugees and the host community in Uganda, our data confirms that not only does our program work, but that there is little difference in impact between these two populations.

 * Note: Prior to joining Seed Effect, 80% of group members had reported a savings amount less than $5.

Seed Effect’s experience and the success of our program has positioned us to be a catalyst that shifts the response to refugee crises, focusing less on short-term solutions and long-term aid, and more on Christ-centered, self-sustaining and empowering tools executed by the refugees themselves. Our desire is to see refugees around the world gain greater access to Christ-centered, saving-led microfinance programs empowering them to know Jesus and provide for their families with dignity.

“The development toolbox offers employment, enterprise, education, healthcare, infrastructure, and governance; it focuses both on refugees and host communities, and it builds upon the capacities of both rather than just addressed vulnerabilities. As soon as we recognize the assumption that refugees will go home quickly is a fiction, then it becomes imperative to embrace a development-based approach as early in a refugee crisis as possible.” – Betts and Collier, Refuge: Rethinking Refugee Policy in a Changing World

What best practices are important to follow when serving refugee populations with economic development? Our friends at the SEEP Network wrote a learning brief with 10 tips for development and humanitarian outlining 10 tips for development and humanitarian actors. The full brief can be downloaded and read here.

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