IDEAS home Printed from
   My bibliography  Save this article

Informal financial markets in Botswana: a case study of Gaborone City


  • Francis Nathan Okurut
  • Thuto Botlhole


The present study investigated informal financial markets in Gaborone, Botswana, with specific focus on the terms and conditions for informal credit, its main uses and the target clientele. The study used primary data, and analytical techniques that included descriptive statistics and analysis of variance. The results show that informal lenders give short-term consumption loans consisting of small amounts, charge very high interest rates, use innovative collateral substitutes such as automatic teller machine (ATM) cards plus personal identification numbers (PINs) and valuable household assets as security, and target mainly the non-poor. The paper makes three policy recommendations: an appropriate regulatory framework for the informal financial sector should be developed, interest rates and other charges should be systematically disclosed so as to encourage competition and reduce the high interest rates, and there should be legislation against the use of ATMs and PINs as security.

Suggested Citation

  • Francis Nathan Okurut & Thuto Botlhole, 2009. "Informal financial markets in Botswana: a case study of Gaborone City," Development Southern Africa, Taylor & Francis Journals, vol. 26(2), pages 255-270.
  • Handle: RePEc:taf:deveza:v:26:y:2009:i:2:p:255-270
    DOI: 10.1080/03768350902899561

    Download full text from publisher

    File URL:
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to search for a different version of it.


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Duarte N. Leite & Sandra T. Silva & Oscar Afonso, 2014. "Institutions, Economics And The Development Quest," Journal of Economic Surveys, Wiley Blackwell, vol. 28(3), pages 491-515, July.
    2. Tesliuc, Cornelia & Silverio Marques, Jose & Mookodi, Lillian & Braithwaite, Jeanine & Sharma, Siddarth & Ntseane, Dolly, 2013. "Botswana social protection," Social Protection and Labor Policy and Technical Notes 89003, The World Bank.

    More about this item


    Informal financial markets; Botswana;


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:deveza:v:26:y:2009:i:2:p:255-270. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Chris Longhurst). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.