Subscribe to our newsletter

Get updates, news and stories from our work around the world.

Follow Us


Opportunity EduFinance
Level 18, 100 Bishopsgate, London EC2M 1GT

Telephone: +44 (0) 7768599834

© 2023 Opportunity International Education Finance functions under its US and UK affiliates. Opportunity International United Kingdom is registered as a charity in England and Wales (1107713) and in Scotland (SCO39692). Opportunity International United Statesis a 501(c)3 nonprofit.

Can Refugee Communities benefit from Education Financing?

By Catherine O'Shea



Uganda hosts 1.4 million refugees, which is one of the largest refugee populations in the world. While there may be cultural differences between refugee communities and the communities that host them, the demand for children and youth to have access to a good education is universal.

These massive refugee communities present an opportunity to offer financial services – including education financing - to refugee households. And yet, according to a survey undertaken in Bidi Bidi settlement of north-western Uganda with over 270,000 South Sudanese refugees, only 13% have access to formal credit (FSDU, 2021). 

Refugee communities are showing increased demand for non-traditional education, such as vocational training, which can offer more direct linkages to employment and enterprise opportunities. However, to enrol, youth need access to vocational loans to help pay fees upfront. Vocational training institutions often need capital to invest in equipment, expand enrolment and make other quality improvements necessary to operate a sustainable training business.

The Education Response Plan for Refugees and Host Communities (ERP) in Uganda estimates that at least 265,000 youth want vocational training opportunities in refugee hosting districts. Access to financial services for enterprise development – such as setting up a tailoring business, restaurant, or salon – is also an important factor that can support refugee households to diversify their income sources. Increased incomes also enable families to afford other education loans for more of their children to access education.

Research Study: Refugee Education Financing Opportunities & Challenges

Between February and April, 2021 Opportunity International’s EduFinance Technical Assistance Facility (ETAF) conducted a mixed-method approach study toprovide market insights on opportunities to link refugee families and their host communities in Uganda with the education financing they want.  Stakeholders in four refugee communities were interviewed for the study: Kampala, Nakivale, Arua and Yumbe.

In anticipation of the study being finalized soon, we interviewed Julius Omoding, Senior Technical Assistance Advisor & Regional Director for Africa, Opportunity EduFinance, to better understand the scope of this research and specifically around the demand for vocational training loans by refugee families.

Julius, a Ugandan himself, also revealed how personal and important this work is to him.  

We need to give people an opportunity to show what they can do. I’m really excited about this work, and I look forward to it growing and growing.

What was your motivation for researching refugee education financing?

We are all focused on education finance and getting more children into schools. In Uganda, we are among the top 3 countries in the world that host the most refugees. EduFinance wanted to find out how many refugee children are here and out of school, and what that means for them and their parents who are in a new country and need to start life afresh.

It’s exciting for me that we can upskill these communities so that their children can have a better future. We always look for the betterment of our children, and this refugee community is entrepreneurial.  I personally want to change the narrative and give these children hope that something good can come out of it. That was a big motivation for me.

Why was this research needed?

Refugees come to Uganda across the whole region - from the South, North, and East from Kenya through the Somalia connection. The key objective was to verify the information that we had and contextualize how the EduFinance model could potentially operate to engage refugee communities. For example, we thought there were more male refugees but actually, there were more female refugees and many single parents.

We want to help engage financial institution partners who were willing to address the different needs of the refugee community segments we are working with. Many financial institutions only have loans for people who are working in the formal sector, which means it is hard for refugees to get away from handouts and live a life where they can develop. This research helped us to better segment the market so a good partner can walk in.

Why is there a demand for vocational education among refugee families?

That’s a beautiful question. Some refugees come to Uganda with basic schooling, but they’ve lost a year or two due to destabilization. For refugees from the Democratic Republic of Congo and Rwanda, if you follow formal education in Uganda, it can take 18 years to complete studies, which is time that these students do not have. 

Vocational training offers an additional opportunity. Parents or guardians can start a generational business and pay for school fees for the younger ones while the older children can train in a vocational skill to support the family business. For example, if a parent is a carpenter and gets a loan for his business, that will be a good source of revenue that can be passed on to their children. In catering, they might build a restaurant which can be interesting as they bring a cuisine which is different from what they locals are used to. 

Vocational skills are something that the families’ older children can learn, and this helps them settle in and interact with the host community through cross-cultural integration.Through vocational education, even after just one year, you can practice and choose to do something you love.

Do existing EduFinance loan products meet the needs of refugee students?

We have the traditional products such as the school fee loan – but these cannot be easily accessed by the refugees, as their earnings are from the world food program or as casual laborers. Banks are not willing to take a risk on these accounts.

We did this research to see how we can look at these earnings with a long-haul view in mind. You can do classes three times a week while also earning. For example, you can work in a salon and put your training skill into practice while continuing to study. We’re looking to create exciting products which do not have a cash-for-service arrangement.

What do you think were the most interesting research findings?

We have a very brilliant refugee community in terms of knowledge and skills, and they do well in their studies. I was thrilled to see that the academic performance among refugees can even be better than in the host community!  If we can complement the desire they have to do well – if given proper attention, these families could thrive.

The demand for education financing is quite high. It is about being creative. With refugees, but also with the Covid-19 situation, I think financial institutions must really embrace new ways of working. 

Gone are the days of throwing all the risk to one person. In order to build communities like this, we need to provide a solution for the existing refugees. Otherwise what will happen when more refugees arrive in Uganda, for example, due to the conflict in the Tigray region of Ethiopia at the moment.

The demand is there and the financial products need to identify possible outcomes. The students are hungry for education and aspiration. It helps the whole community to grow. 

How do we get more financial institutions to offer refugees relevant education financing?

I think loan product segmentation is a way we could help the financial institutions (FIs) get into the sector without many losses. Changing mindset is key. We could poll refugees who have been in Uganda for a while and find success stories to share. We are also presenting different loan product options to FIs based on different risk tolerances to show how they can still offer education financing to refugees even if they are very cautious. It’s a road map for FIs to say ‘okay, if you are afraid to jump in with both feet let’s take one step at a time and then maybe you will be enticed to do more and then you can grow faster.’

The younger generation – including refugee youth - is interested in AI and other technology. We want them to feel they don’t have to follow in the shoes of their grandparents before they can follow their own dreams. Vocational education is very handy. It develops what you are good at and there is an output – if it’s a handbag, if it’s a chair, if it’s a service, you’ll see it. Having a clear marketable output really helps the FIs get involved, and once they are in you can show them the bigger picture of what is possible.

If we are going to grow as a world, we need to take in and harness the skills of people like refugees. We need to give people an opportunity to show what they can do. I’m really excited about this work, and I look forward to it growing and growing.

 If you are interested in understanding how EduFinance partner schools are already supporting refugee students, review our Key insight piece here!

Subscribe to our newsletter