Saving instruments and food security in Sub-Saharan Africa: A case study of smallholder farmers in Mali

Food security is of high concern in Mali and throughout Sub-Saharan Africa. Nonetheless, existing policies primarily target the health and agricultural sectors, overlooking potential benefits of financial sector development. We aim to fill this gap through a case study, relying on primary collected saving and food security data from smallholder farmers in Mali. By using ordinary least square models as well as an instrumental variable approach, we analyze the associations between farmers’ saving instruments and food security. We focus on four different saving instruments, including formal mechanisms such as bank accounts, semi-formal mechanisms such as mobile money, and informal mechanisms such as saving in secret hiding places, and with a trusted person. These four instruments are common in Mali and across Sub-Saharan Africa. The findings reveal heterogeneity in the choice of saving instruments and amounts and food security. Our contribution aims to inform decision makers on designing policies at the nexus of finance and agriculture, which is crucial for addressing the vulnerability of smallholder farmers. Since the severe nutritional situation in Mali is indicative of a crisis-affected region, our findings might be applicable to other countries in Sub-Saharan Africa as well.