Network for Youth in Transition

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Savings groups and educational investments to remove financial barriers to girls’ and boys’ school attendance

Research Briefing
Despite the introduction of free primary education in many developing countries, households continue to face direct and indirect costs of education. Particularly at higher levels of school and for communities still dependent on subsistence farming, these are a barrier to learning. Could
access to better, village-level facilities for saving and borrowing money help lower these financial barriers?


Savings groups – a low-risk form of microfinance based on members’ own savings, often known as Village Savings and Loans Associations – are a key strategy employed by Plan to enhance household economic security. Savings groups are an effective way to foster a savings habit, smooth household income, and build household financial assets. These groups meet periodically (usually weekly), require members to contribute savings, allow members to take loans with interest, and “share out” the accumulated savings and interest to members at the end of a cycle (usually annual). Plan International
has facilitated savings groups since 2003, reaching about 850,000 people – around 82% of them women – in 25 countries.


Plan UK commissioned a report to better understand how, and to what extent, savings groups can help break down the financial barriers to education.

An extensive review of research and evaluations of savings groups facilitated by Plan and others around the world was undertaken, as well as qualitative research in two communities in rural Ghana.The research suggests that while savings groups don’t necessarily allow for increased
household education spending or increased enrolment rates in the short term, probably their greatest potential comes from the income smoothing effect: participants are able to pay formal and informal education fees in a more timely manner, thus reducing absenteeism.

Improved attendance rates are an important outcome – especially if it helps improve progression and learning outcomes, and means that girls and young women can access money for school fees in ways that don’t put them at risk of violence, abuse or pregnancy.
Over the longer term, savings groups can help support livelihoods that may lead to increased household investments in education. There is also some evidence of savings groups affecting health and nutrition, and household-level decision making processes, in ways that are likely to positively affect education in the medium to long term.

Click here to read full report

Source: Plan UK

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