Effects of Saving Groups on People’s Soci-Economic Well Being in Northern City Division, Mbale City
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Date
2024-07-15
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Uganda Christian University
Abstract
Despite of government effort to support saving groups due to their proximity and benefits to members, many people still experience low socio-economic wellbeing. This study assessed the impact of saving groups on people’s socio-economic wellbeing in Northern City division of Mbale City in Mbale district of Eastern Uganda. Specifically the study investigated how participation in saving groups affects income levels and overall financial stability of individuals in the Northern City Division of Mbale and the extent to which saving groups have contributed to community development and social cohesion within Northern City Division of Mbale. Also the study established ways of solving the effects of saving groups on socio-economic well-being of people in Northern City division. The study used cross-sectional design to analyze data from the study area with the help of both qualitative and quantitative methods. The researcher collected data from 80 respondents in the study area who were selected using simple random and purpose sampling and questionnaires together with interview guide were used to collect data from study subjects. The study found that participatory approach to financial management empowers individuals particularly those in underserved communities to invest in income-generating activities, cope with emergencies, and build assets and saving group participation facilitates asset accumulation and financial resilience among individuals, leading to enhanced socio-economic well-being. Also, participation in saving groups fosters financial discipline and savings habits among individuals, which positively influence income levels and financial stability and saving group participation provides individuals with access to affordable credit, which can be utilized for productive investments and income-generating activities. Additionally, empowerment through access to finance where saving groups empower individuals, particularly women, by providing access to financial resources and decision-making opportunities and asset accumulation and poverty alleviation where the accumulation of assets through saving groups is postulated to contribute to poverty alleviation and enhanced socio-economic well-being. access to credit and financial inclusion where the provision of credit through saving groups is believed to enhance financial inclusion and socio-economic well-being and income diversification and risk management whereby pooling resources and engaging in collective savings, members can mitigate economic vulnerabilities associated with unpredictable incomes and external shocks. The researcher recommended that one potential solution to address the effects of saving groups on socio-economic well-being is to enhance financial literacy and education initiatives within these groups and promoting access to formal financial services alongside saving group participation can enhance socio-economic well-being by providing individuals with a broader range of financial products and services. Other recommendation include fostering entrepreneurship and business development initiatives within saving groups can contribute to socio-economic well-being by creating employment opportunities and stimulating economic growth and strengthening social networks and community cohesion within saving groups can enhance socio-economic well-being by promoting resource sharing, collaboration, and mutual support among members. Also integrating savings-led approaches into broader development interventions can enhance the impact of saving groups on socio-economic well-being by addressing structural barriers and promoting systemic change.