Introduction
Iganga District Farmers’ Association with the financial support and technical backing from Hope for a Child is implementing Village savings and loans (VSLA) activities in 6 sub counties of Buyanga, Bukanga, Namungawle, Ibulanku, Ivulula and Bulamagi in Iganga District. In just one year, the project has attracted a total membership of 1470 (928 female).
How VSLA works
In the VSLA methodology, people select themselves and voluntarily come up to form groups of 15-30 members. With the help of the community Based Trainer (CBT) they under go six major trainings before savings and loaning start.
Every group is autonomous with its own leadership, internal regulations, decide the value of a single share, own a tool kit, and agree on when to share the savings (usually 8-12 months) among others.
Members meet weekly to carry out their savings and loaning activities. One is allowed to buy a maximum of five shares per week, loan interest of 10% per month, contribute to the welfare fund which is given to group members in form of a grant in case of any emergency like death of a relative, fees, sickness etc and paid back with no interest.
The regular savings contribution to the Association (group) is deposited with a time lag in mind of about 8-12 months. Therefore when a group reaches the agreed time for action audit (sharing out), the savings are distributed to individual members usually on the basis of a formula that links pay out to the amount saved.
Out of the village saving and loan scheme, members have managed to access loans and managed to come up with small income generating activities/ business like farms for commercial agriculture, poultry farms among others which has seen an improvement in their sources of incomes and hence an improvement in their standards of living.
For example, Kirongosi Ayubu a member of of Kyaterekera Village Saving and Loans Association, Namungalwe Parish in Namungalwe sub county, Iganga District. He is married with 1 wife and five (5) children of whom 2 are boys and 3 girls. Out of the five children 3 are at school in Universal Primary Education where the Eldest is sitting for PLE this year and the two have not yet started.
Situation before joining VSLA
Kirongosi Ayubu laments that before joining VSLA he was a member of a rotating Savings and Credit Association (ROSCAS) where he could contribute an equal amount of money and this would be allocated to a single member at each meeting through either drawing lots or according to a schedule agreed upon at the start of the cycle. With his family, he was living in a grass thatched house and encountered serious challenges in running the family for instance, buying the basic necessities: soap, paraffin, going without meals or having only one, among others since it was hard to get money.
Mr. Ayubu with his family under his grass thatched house
He was by then engaged in farming on a small scale basically for food as well as local poultry for eggs. This could earn him 82500/= monthly out of the 15 birds on his farm and this was so because of poor feeding due to lack of enough capital and no access to loans to buy drugs.
THE IMPACT OF VSLA ON HIS LIFE
After joining the VSLA supported by Hope for a Child in February 2009 where he saves 5000/= on weekly basis, Kirongosi Ayubu says that he has witnessed a tremendous change in his life. Like of recent, saving has come to be compulsory on his side on weekly basis, which encouraged him to work hard so as to get what to save in the group.
He says with a loan 500,000/= he accessed from the group he has managed to boost his poultry business. Using the loans got from the VSLA, he has managed to increase on the number of birds, buy feeds and drugs for the poultry therefore as a result. Currently the poultry farm can produce 30 trays per month, which give him shs. 165,000/= per month.
Mr. Ayubu with some of his poultry birds
Using the current income, he has managed to start up a permanent house which is now at roofing level and he is expecting to complete it by the end of this year.
He is also able to buy the basic needs and have time to concentrate on farming thus food is assured for the family.
Mr. Ayubu and family seated next to their un-finished house
|