The Provision of Microfinance in the Wake of Conflict: The Ugandan Example

Abstract

In response to the bleak economic opportunities that accom­pany war, governments, banks and non-profit organizations have expressed interest in extending financial services to af­flicted areas. Doing so without well-developed plans and strategies can be fraught with risk. This paper recognizes the benefits that organizations can bestow on war-torn communi­ties and explores microfinance service provision in post-con­ flict environments using the example of Uganda. I first explain post-conflict microfinance and how it differs from typical microfinance operations. I then outline general theories of post-conflict microfinance service provision, including condi­tions for entry, target populations, and suggested strategies. The Uganda case study illustrates these theories in action, detailing the types of institutions that are active, the success achieved, and the reasons for success or failure. Finally, based on these lessons, I offer nine specific recommendations for governments, service organizations, and policy makers.