A Multifaceted Intervention with Savings Incentives to Reduce Multidimensional Child Poverty: Evidence from the Bridges Study (2012-2018) in Rural Uganda.

Using a randomized controlled trial design, we examine the effects of savings incentives (match rate 1:1 versus 1:2) with mentorship and financial trainings on child poverty among 1383 orphaned children (mean age 12.7 years at baseline) in rural Uganda. Given the difficulty to capture child poverty using monetary measures, we use a multidimensional class of poverty that captures four dimensions: health, assets, housing, and behavioral risks. Results show that children in treatment groups experienced reductions in poverty incidence by 10 percentage points (or deprivation score by 8 percent) relative to control group counterparts at four years post-baseline, and a higher savings incentive led to stronger effects. Further, children in treatment groups were more likely to escape the poverty trap. Finally, we assess the robustness of these results to various weighting structures. This study offers a unique evidence on effectiveness of a multifaceted intervention targeting children in alleviating poverty.

Effects of Financial Incentives on Saving Outcomes and Material Well-Being: Evidence From a Randomized Controlled Trial in Uganda.

The use of savings products to promote financial inclusion has increasingly become a policy priority across sub-Saharan Africa, yet little is known about how families respond to varying levels of savings incentives and whether the promotion of incentivized savings in low-resource settings may encourage households to restrict expenditures on basic needs. Using data from a randomized controlled trial in Uganda, we examine: 1) whether low-income households enrolled in an economic-empowerment intervention consisting of matched savings, workshops, and mentorship reduced spending on basic needs and 2) how varied levels of matching contributions affected household savings and consumption behavior. We compared primary school-attending AIDS-affected children (N = 1,383) randomized to a control condition with two intervention arms with differing savings-match incentives: 1:1 (Bridges) and 1:2 (Bridges PLUS). We found that: 1) 24 months post-intervention initiation, children in Bridges and Bridges PLUS were more likely to have accumulated savings than children in the control condition; 2) higher match incentives (Bridges PLUS) led to higher deposit frequency but not higher savings in the bank; 3) intervention participation did not result in material hardship; and 4) in both intervention arms, participating families were more likely to start a family business and diversify their assets.