Village Saving Fund Mentoring Day

In early 2008, Project HOPE used the successful experiences of its Orphan and Vulnerable Children (OVC) project in Mozambique to launch a pilot Village Savings Fund (VSF) project in Munsieville, in partnership with The Haven (a local NGO).

VSFs involve small groups of 10-25 OVC caregivers who pool small amounts of savings, and then use those savings to provide interest-bearing loans to each other for their short-term credit needs (such as buying seeds for the planting season, paying school fees so children can attend school, paying for medical assistance, and to take advantage of business opportunities). The interest on the loans is essentially interest on the pooled savings, and goes back to the group members thus providing an increased revenue source whether they are borrowers or not. Local capacities are built because self-governing groups mobilise their own funds, manage them, decide on their loan terms, and receive interest return on their savings through investing in loans.

Because of the way the community is structured in Munsieville, Village Saving Fund (VSF) groups are based on the different nationalities in the settlement – i.e. there are groups from Mozambique, South Africa, Zimbabwe etc. The groups generally tend not to interact with each other, and therefore lose out on benefiting from learning from one another. Over the past few months some of them have done extremely well by starting small businesses selling chickens and baking cakes, while others have struggled to get off the ground.

So that all the groups could learn from their counterparts in the community, a mentoring day was held recently, where they all came together to share their successes and the problems that they have faced. To add to the excitement, there was a prize for the most successful group (based on weekly meeting attendance, savings & loans portfolio, initiatives taken to start up a business etc).

The day was a great success. The groups shared information about what they have been doing – one group started by purchasing 10 chickens a week to sell, and now they are up to 25 a week. Other groups shared frustrations about the lack of unity between group members which makes it more difficult for them to work together. The highlight of the event was the announcement of the winners – a Mozambican group called “Sizanani” which means “helping each other.” They received certificates and a prize of food and clothing and the video below shows you how excited the room became when the winners were announced!

The day provided the motivation needed for the groups who have been struggling to get on the right track, and a Project Hope team will be following up with house visits over the next few months to encourage them further as they discover the important difference that VSFs can make to the health and lives of people living in informal settlements here in South Africa.