People living in poverty in the conflict-stricken area of North Darfur face a severe shortage of money for household needs. They either endure the hardships or try to find someone to borrow money from. When it comes to women smallholders, they lack money for inputs and other cash needs in their household’s.
To address this problem, saving is a way forward. Those who can save then have funds for unexpected needs in the household and for timely investment in groups.
Practical Action Sudan, in partnership with the Women’s Development Association (WDAN) initiated training of horticulture smallholders using the Savings and Loan Association (SLA) approach.
SLA members save through the purchase of shares with a maximum purchase of five shares allowed per saving meeting. This allows for flexible saving depending on the surplus money members have. They meet weekly or monthly and continue saving for a period of nine to twelve months.
The project officer for the Community Initiative Sustained Development project within Practical Action Sudan, explained:
“The aim of SLA is to enable resource-poor households to access financial services in order to finance income generating activities that would increase their income and lift them permanently above the poverty line. It enables money to be available at the right time for purchase of inputs and other energy costs.”
SLA groups are providing smallholder women with the opportunity to save and borrow flexibly without having to go to the bank. With this savings methodology there are no problems of high minimum deposit requirements, hidden charges, complicated procedures, or difficulty in accessing loans.
The funds assist in building resilient communities and provide social safety nets, as they are used for inputs purchase, diversifying into other income generating activities, immediate household needs and provide room for assistance to members in case of death, disease or natural disasters. Such diverse services are not provided by local moneylenders, as they are not willing to provide for the poorest.
The process is very transparent as it involves each and every member within the sharing and lending processes. The fund is shared out at the end of each cycle which is normally nine months to a year.
This SLA methodology has proved to be a success. This year 20 SLA groups have been established in Elfashir in North Darfur. Shares accrued range from a minimum of 500SDG (£62) to 700SDG from monthly savings. In addition, the groups also pay towards a social fund, which can be used, when a member is having acute problems, such as unexpected medical expenses.
Villages using this method have been successful in helping women to learn about saving, to enhance social links within their communities and to make their first investments.
The project team conducted monthly field visits to monitor the progress of loans saving committees. Committee members contributed an average amount of 25-30 SDG (£8) each month. 345 women have benefited and saved a total amount of 74,101 SDG. At the end of a cycle the money is distributed back to the group members. It is very important that every member’s money is placed in their hand.
In total 879 households have accessed LPG through this savings program in Elfashir in different districts and 76 women have access to loans to establish income generation activities.
Women were thankful to Practical Action and the Women Development Association Network for empowering them and enabling them to finance themselves and their family in the face of extreme economic hardship.
“Now I can confidently grow for the market because I have access to finance for inputs from my savings group. I was about to give up due to lack of money.”
Access to clean sources of energy, livelihood and finance has led to the building of self-respect and self-reliance in the community.