By Rogers Wanambwa

KIU Main Campus - According to Bank of Uganda (BoU), Ugandans have been saving at record levels since the lockdown begun.

BoU statistics indicate that as of May 2020, the amount of money Ugandans had in banks as term deposits reached UGX 8.5 trillion c��?? the highest amount ever held there in a single month.

Term deposits, also known as fixed deposits, are where an individual puts their money in the bank for a specified time to earn interest on it. Withdrawing the money before a specified time means one forfeits the promised interest which is currently between 4 per cent and 7 per cent annually.    

At the beginning of the lockdown, Ugandans averagely had UGX 8 trillion on their bank accounts but by May, they had added half a trillion to this amount c��?? this in spite of the fact that many Ugandans had lost their jobs or had seen slowed down business.

Ugandans also deposited more private demand deposits which can be withdrawn anytime and do not normally attract an interest from UGX 6.9 trillion in March to UGX 7.2 trillion in May, bringing the total amount held by Ugandans on their bank accounts to UGX 15.2 trillion.

On a similar note, although banks are expected to lend much of this money instead of keeping it in their vaults, Wilbrod Owor, the Executive Director of Uganda Bankers Association (UBA), told reporters last week that banks only managed to lend UGX 1.1 trillion in April 2020.