More than half of Burundian respondents say they save money regularly, but savings remain concentrated in community groups and households rather than banks, exposing a challenge for financial institutions seeking to mobilize deposits and expand access to formal financial services.
Burundi’s National Financial Inclusion Survey, 2024, found that 53% of respondents saved regularly, up from an overall savings rate of 37% in 2012. Yet only 11% said they saved through banks, while 5% reported using cooperative savings and credit institutions, known as COOPECs.
Instead, 51% of respondents said they kept their savings in an association, tontine or ikirimba, a community-based savings arrangement. Another 37% said they kept money at home in a safe place.
The report concluded that savings were “largely escaping financial institutions,” despite the increase in the proportion of people who save.
The percentages for different savings methods may overlap because respondents could use more than one arrangement. They nevertheless point to the importance of informal savings mechanisms in Burundi’s financial system.
For banks and other formal providers, the figures raise questions about why households continue to rely on community-based arrangements and whether formal savings products offer the accessibility, flexibility and affordability they need.
Barriers to formal credit
The survey identified obstacles that extend beyond savings. It found that 10% of respondents had applied for credit or an overdraft from a formal financial institution during the previous 12 months.
Among the reasons respondents gave for not seeking credit, 35.4% cited an inability to repay. Another 19.2% said they felt intimidated or lacked confidence when dealing with a financial institution, while 15.1% said they feared taking on debt.
The report also found that 12.5% believed credit was intended for wealthy people. The same proportion cited a lack of information about where to go or how to apply.
In its discussion of financial inclusion barriers, the report identified “the inability of clients to repay credit or an overdraft,” lack of confidence in dealing with financial institutions, fear of borrowing and the perception that credit is reserved for the wealthy.
These findings suggest that increasing the number of financial institutions or making services available does not, on its own, ensure that households will use them. Affordability, information and borrowers’ confidence also affect demand.
The survey also highlighted concerns about informal lending. Respondents cited collateral and guarantor requirements, the absence of credit institutions in remote areas, paperwork and lengthy application procedures among the reasons people turn to informal providers.
But informal borrowing carries its own risks. The report said respondents complained that monthly interest rates could be “too exorbitant” and that short repayment periods could leave borrowers struggling to make investments before repayments fell due.
Credit growth does not necessarily mean business expansion
Access to formal credit has increased over the longer term. The report found that the share of adults benefiting from formal credit rose from 2.9%, or about 111,360 people, in 2012 to 10%, or approximately 585,880 people, in 2024.
However, reported borrowing purposes show that credit serves both productive and household needs.
Among the purposes cited by borrowers, 24% said they borrowed to buy fertilizer and seeds, while 21% borrowed to cultivate fields. School fees accounted for 20% of reported borrowing purposes, and agricultural equipment for 16%.
Only 3% cited expanding an existing business, while 2% said they borrowed to start a new business. Meanwhile, 23% cited current expenses and 12% medical costs.
The figures represent reported purposes, not the share of total lending by value. They do, however, raise questions about how effectively formal credit is reaching entrepreneurs and small businesses seeking capital to expand.
The report described credit demand as being driven by “production and consumption.” It said entrepreneurs and self-employed people mainly borrowed to invest in their businesses, while households borrowed to meet consumption needs.
For policymakers and lenders, the challenge is not only to expand access to credit but also to understand whether loan terms, collateral requirements and repayment schedules match the needs and cash flows of small businesses, farmers and households.
Digital finance meets a cash-based economy
The survey also found that digital financial services had expanded, but cash remained widely used for everyday transactions.
It reported that 44.04% of the adult population, or about 4.6 million adults, used formal nonbank financial services. Yet respondents continued to rely heavily on cash for routine expenses.
In Burunga province, the report found that 100% of respondents paid for food in cash. Cash was also used for medical expenses by 95% of respondents, rent by 80.4% and water and energy bills by 87%.
The findings indicate that access to digital services does not automatically translate into widespread use of digital payments across household spending.
The report said Burundians continued to receive income in cash and preferred to spend in cash, despite the growth in digital financial services.
This presents a further challenge for financial institutions and payment providers: expanding access must be accompanied by services that people can use conveniently for the transactions they make most often.
Beyond access to financial services
The survey ranked Burundi fifth among East African countries in overall financial inclusion, with a reported rate of 78.7%, behind Rwanda, Kenya, Tanzania and Uganda.
But the report cautioned that financial inclusion involves more than access to an account or service. Its recommendations called for greater attention to the impact of financial inclusion and to users’ financial well-being.
The report said the “greatest opportunity” lay in moving beyond access and adoption to measuring those outcomes.
For Burundi’s financial sector, the findings highlight a divide between the widespread practice of saving and the limited use of formal savings products. They also show that barriers to borrowing include repayment concerns, confidence, information gaps and the terms offered by lenders.
