Village Savings and Loans Associations

A Letter from Inge and Larry Sthreshley, mission co-workers serving in Congo

Fall 2024

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Dear friends,

Sometimes things go like you planned and sometimes they just don’t! When we started the SEMI project (Essential Maternal and Child Health Services), we had great plans to start 200 Village Savings and Loans Associations or VSLAs. We purchased the kits (i.e., the materials the group would need to get started), trained the trainers, and then did the first pilot round. Each person trained had started four VSLAs. We were ready to move into the next phase to scale up the number of VSLAs. Then the SEMI project encountered difficulties. Activities were put on hold. Then an early closure date for the SEMI project meant only “lifesaving” activities would be undertaken, so the VSLA activity was essentially shut down.

Introducing the concept of village savings and loans to the community in the village of Dengamongo, Kakenge health zone. Photo Credit: PRODEK

A Village Savings and Loan Association (VSLA) is essentially a group of people who come together to create their own local community bank. Each VSLA group, made up of around 25-30 members, writes up the rules and regulations of their association with the help of a VSLA advisor (in this case a Community Animator). They vote on their officers. Then they come to an agreement on the value of a “share” and the minimum weekly number of “shares” members should purchase.

The VSLA group then meets every week and members start purchasing shares. The amount is recorded in a member’s savings book. Member account books and cash are all kept in a metal box or “safe” with three different locks so that it takes three members to open the “safe.” The group writes up their criteria for giving loans and they set the interest rate and time frame at which loans are to be paid back. After the group has built up some capital, members can take out loans with interest. At the end of the savings and loan cycle, each member gets back the value of their number of shares at the close of the VSLA cycle, in addition to a portion of the interest that was generated when members paid back their loans.

The management committee of the VSLA named Bobumue in Kakenge health zone.
Photo Credit: PRODEK

The groups also establish a solidarity fund and set the minimum amount every member must pay into the solidarity fund every week. They establish their criteria for giving members support with solidarity funds when a crisis strikes. As I look through the list of 32 VSLAs that have been established, I notice that the groups have given their VSLAs names like “Hope,” “Strength in Unity,” “Moving Forward Together,” etc.

Naturally, a part of me is very disappointed and discouraged with the turn of events with the SEMI project. But on the bright side, PRODEK (Programme de Development du Kasai) and the SEMI nutrition team did get 32 VSLAs established. Most, but not all, are progressing well. We have gained experience and can now improve on the VSLA training. In addition, we provided a VSLA model that other members of the community can replicate on their own.

We also have the opportunity now to try this again with the Multisectoral Nutrition and Health project (PNMS) and take it to scale in other health zones of the Kasai based on what we have learned. The PNMS project is a $22.6 million-dollar multi-disciplinary nutrition program that the nutrition team and I wrote over three years ago, which is funded by the World Bank and is being implemented by IMA World Health. The objective of the program is to strengthen nutrition and nutrition sensitive services and activities in 10 out of the 18 health zones of the Kasai Province in an effort to bring down the rate of chronic malnutrition.

Meeting to distribute capital at the end of a VSLA cycle in Kakenge health zone

So why are village savings and loans associations part of a nutrition program? Poverty is one of the primary drivers of chronic malnutrition. Women in the Kasai do not have many opportunities to take out loans to start businesses nor do they have much agency in managing money. VSLAs are considered a nutrition sensitive activity that can give women financial opportunities that help reduce household poverty. The VSLAs we will be starting will be comprised of both men and women, but we will be targeting primarily young mothers to help them gain access to small loans to start a business and provide a mechanism whereby they can save money. They will also receive training in setting up and managing income-generating activities.

Soon, I will be traveling to Tshikapa in the Kasai province where we will train 20 community animators on how to establish VSLAs. In turn they will train 20 village agents to do the same. Our goal within the year is to have 250 VSLAs established. It is a bit of a stretch, but possible. I look forward to trying this again.

And, in the meantime, we will stay in contact with the VSLAs we started in the SEMI project. One of the last things we did was give each VSLA group a phone. The phones have an app with a reporting form on it which they can fill out and send in with their quarterly data. On receiving the phones, several groups thanked us for not abandoning them and for valuing their efforts.

Thank you for your prayers for the success of this activity and these VSLA groups. And thank you for your financial support of Presbyterian World Mission. Through your support, young mothers in the Kasai will have more opportunities to provide for their families.

Blessings,

Inge