Several years ago, during a business trip to one of the African countries, I noticed the large number of houses under construction, which seemed to be untouched for a long time. At that moment I was sure that this was a negative indication of the state of the local economy, when many residents started building their houses and had to stop in the middle, probably due to lack of funds. But as I researched the issue in depth, I was surprised to find that the exact opposite is true, and that those houses under construction are not an indication of financial difficulties, but rather of their high status, representing the local form of savings.
For hundreds of millions in sub-Saharan Africa, basic economic services like formal savings or loans are still a distant dream. As over 66% of the population are unbanked, and lacking access to the most basic formal financial services, informal and creative solutions are a must. Building houses is one of them; as hundreds of millions are managing their financials with cash, long-term savings do not exist, and keeping your cash at home is dangerous. So, as I learned, whenever someone has some spare cash, they start building a house, presenting a much safer saving option. And so, thousands of under-constructed houses arise, waiting for their owners to have some additional cash to finish the work.
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