Attachments
Executive Summary
Introduction. The Swedish International Development Cooperation Agency (Sida) and United Nations High Commissioner for Refugees (UNHCR) have developed a joint program to facilitate access to credit for income generating activities and consumption for the refugee population and their host communities in Jordan and Uganda. The two agencies selected the Grameen Crédit Agricole Foundation (GCAF) as a partner for the initiative and, as a first step, commissioned a country assessment in Jordan and Uganda in order to assess refugees’ demand for and access to financial and non-financial services as well as the challenges and opportunities they face. This report presents the findings from the demand assessment in Jordan.
Methodology. The assessment is primarily based on original data collection through direct consultations with refugees as well as financial service providers (FSPs) and other relevant stakeholders. In particular, it involved interviews and focus group discussions with a total of 117 refugees (48% women and including 108 Syrians, 4 Iraqis, 3 Yemeni, and 2 Sudanese) in the capital Amman (49%) and the Zaatari ‘camp’ or settlement in the Mafraq governorate (51%) as well as interviews with 13 stakeholder entities. The assessment also relies on the review of secondary sources. Since direct consultations only involved a limited number of refugees, the data and information collected are not meant to provide statistically significant results. Furthermore, due to the lack of comprehensive socio-economic data for the whole refugee population, it was not possible to randomly select a representative sample. In fact, consulted refugees include an overrepresentation of assisted, and hence more vulnerable, individuals and households. Consequently, findings from the direct consultations with refugees within the scope of the assessment cannot be translated onto the whole refugee population.
Contextual Framework. With a total of more than 750,000 registered refugees (50% female), Jordan (population around 10 million) is one of the world’s largest hosting countries. The great majority are Syrians, but also include Iraqis as well as a more limited number of Yemeni, Sudanese, and Somalis. Around half (47%) of the refugee population are of working age and most (83%) are self-settled, i.e. living among the Jordanian population primarily in urban areas (the remaining share, all Syrians, live in one of three closed settlements).
Jordan’s small economy is generally struggling with absorbing the effects of the Syria crisis, suffering from rising unemployment and high government debt. The country’s strategic response to the refugee crisis caused by the Syria conflict is outlined in the Jordan Response Plan, which has adopted a resilience-based approach and seeks to bridge the gap between addressing more immediate emergency assistance needs and longer-term institutional and systemic weaknesses. The plan incorporates the country’s endorsement of the so called ‘Jordan Compact’; an agreement between Jordan and the donor community which, among other efforts, targets the provision of 200,000 job opportunities for Syrian refugees. While some enabling steps have been taken (including the issuing of almost 100,000 work permits, primarily in the ‘open’ sectors of agriculture, construction and manufacturing), the general regulatory framework still imposes fairly strict conditions, limiting the opportunities for formal employment and self-employment on part of refugees (particularly non-Syrians) in a good number of professions and sectors (refugees are for example not allowed to engage in home-based businesses outside the settlements). Working refugees are consequently commonly engaged in informal activities.
In recent years, Jordan records a general improvement in the level of financial inclusion, with around onethird of adults having an account with a financial institution in 2017. Formal financial access has generally improved also for the lower income population as well as women, but, except for remittances, the formal financial inclusion of refugees is very low (7.5% account ownership). Jordan’s microfinance sector is relatively young and small, but has grown quite remarkably in recent years. However, so far only one microfinance institution, namely the Microfund for Women, is actively and successfully targeting the refugee population through the provision of credit. Furthermore, refugees are specifically targeted by the National Financial Inclusion Strategy (NFIS) for the 2018-2020 period, which focuses on mobile money accounts as the primary ‘point of entry’ for refugees (mobile money wallet services have recently been launched in the country and digital financial services are generally promoted by the strategy as one of three core industry pillars for financial inclusion). Finally, refugees can open a mobile wallet account with a Ministry of Interior (MoI) service card (which they can easily obtain with the biometric UNHCR registration), but, like all foreigners, need a passport to open an account with a financial institution.
Key Findings - Human Capital. The majority of refugees, mainly Syrians, have been in Jordan for several years and hence live in a situation of stable/protracted displacement. Interviewed refugees, almost all (96%) of working age, live in medium sized households and with an average of 5 dependents. Most refugees have a relatively modest educational background. While a small share (12%) of interviewees has completed post secondary levels of education and would qualify for more skilled professions and employment, the majority have either completed only primary school (57%) or no school at all (10%). Female and Amman-based respondents generally record lower levels of economic/financial independency as well as education.
Key Findings - Social Capital. While interviewed refugees most commonly socialize with and rely on fellow refugees, one-quarter also regularly interacts with and seeks support from Jordanians (especially in Amman). Interactions through structured groups and associations are more frequent in Amman, while consolidated relations in Zaatari are more individual. Social bonds are generally important for the livelihood strategies of most refugee households, both within and beyond settlements. Concrete support from international and Jordanian agencies and non-governmental organizations (NGOs) is also relevant for some respondents (particularly in Zaatari). Within such a context, agencies/NGOs (as well as aid disbursements) can function as a powerful bridge between refugees and formal financial actors/channels and hence play a key role in paving the way for initiatives targeting the formal financial inclusion of refugees.
Relations with Jordanians are generally positive and supportive at the micro (i.e. community) level, with consulted refugees and relevant stakeholders not pointing to any particular tensions between refugees (especially Syrians) and the host communities. However,since the economy is currently struggling to absorb the effects of the Syria crisis in general, potential sources of conflict can be perceived at the macro (i.e. country) level. The creation of employment and self-employment opportunities for refugees could for example cause tensions with unemployed or underemployed Jordanians. In general, therefore, it is important for any assistance or development intervention to consider both refugees and low-income host communities.