Village
savings and loans associations (VSLAs) bring together small groups of people,
usually 20 to 30 members. As the name suggests, the model is based on savings
rather than debt, and, leaves the spending control in the hands of members instead
of professionals. These groups can be
empowering for members, particularly women, by improving their capacity to
manage money and creating access to microloans generated from each group’s
savings. In the financial year 2012/2013 alone, IDF supported the creation of 38
new VSLAs (16 in Rakai, 12 in Kibale and 10 in Sironko) with 1,031 members;
90% of whom are women, with savings of 175,845,450.
Kibale
Civil Society Network (KCSON) employed the VSLA model for the IDF funded
project 2012/2014. It was designed to
help the poorest save as well as, a mobilization tool through which human
rights information is channeled, since many are not attractive to traditional
microfinance institutions. “What is really interesting and powerful is
that they (VSLAs) are self-generating. The cohesion between the people is
really strong. They trust one another and are willing to experiment together.”
said Paul Mulindwa, KCSONS Coordinator.
He adds that
for many people in Uganda, saving is a myth rather than a reality and a notion
associated with the financial institutions like banks, yet spending is a daily
and even if one has no money; he/she will borrow to spend. This situation was
not different with people of Akayoro Village in Kezimbira parish-Mugarama Sub
County in Kibaale district until the intervention of KCSON. With support from
Independent Development Fund (IDF), KCSON facilitated the formation of a
Village saving and Loan association (VSLA) in Akayoro Village in Mugarama S/C
–Kibaale district.
After
receiving the training in saving and promotion of Human rights in May 2013 the
group (Abalihamu Buroro Akayora), the group members embarked on saving. As a result of continuous saving and
borrowing, the group’s total share by the end of December 2013 was UGX.2,
061,000 compared to UGX 300,000 they started with. The group members have been
able to borrow and invest with most of them setting up small retail shops and
others doing petty business such as market vending. This has enabled them to support
their children’s rights to education and other necessities.
In Rakai District, Kagamba Sub County
(Kasankala parish under the Rakai Community Based Rights Project supported by
Independent Development Fund (IDF), Bivamuntuyo VSLA group shared out shillings
2,450,000= (Two million four hundred fifty thousand), after 8 months of their
savings. As a result members have managed to pay school fees for their children
and others have also purchased land for
their agricultural projects.
