Strengthening Savings and Loans Associations In Zambia

20-Oct-2020 | Projects | Petronella Chindumba


Strengthening Savings and Loans Associations In Zambia

Financial Access for Community-Based Entities (FACE)

SOS Children’s Villages Zambia and the Rural Finance Expansion Programme (RUFEP) of the Ministry of Finance have signed a grant agreement of ZMW 3,249,820 for the implementation of a project entitled “Strengthening Savings and Loans Associations in Zambia” (Financial Access for Community-Based Entities-FACE). The project will run for 12 months effective November 2020. SOS Zambia will implement the project in Livingstone, Choma, Chipata and Chadiza and target 1,500 beneficiaries who are in 75 savings and loans groups.

 

The goal of the project is to strengthen Village Savings & Loans Associations and facilitate linkages with financial service providers. The project objectives are:

1.            To strengthen 75 Village Savings & Loans Associations in four (4) Chiefdoms of Chipata, Chadiza, Livingstone and Choma Districts.

2.            To facilitate 75 Village Savings and Loans Associations’ linkages with financial Service Providers  to enable them access financial services

3.            To raise awareness in 12 communities of the four (4) target districts in financial literacy on the benefits of joining savings groups

The project will target low-income households in the target communities with the aim of according them an opportunity of accessing financial services. This will be achieved by strengthening community based financial groups and facilitating their linkage to ZANACO, a financial service provider, which is in line with Window One (1) of the RUFEP and outreach facility window. The proposed project will raise awareness on the importance of VSLAs formalising linkages with Madison Finance, which will place them on their digital platform. The VSLAs will use ICTs through FSPs and MNO to conduct their transactions.  

The target beneficiaries will receive training in management of VSLAs. This will increase financial literacy of members on savings and help reduce the number of loan defaulters. Awareness raising on the benefits of joining savings groups, especially for the male participants, will be conducted as male involvement in community savings group has been a major challenge. To ensure project sustainability and community ownership, training of trainers for VSLAs agent will be conducted. The Agents will be responsible for training other members, monitoring the management of the groups and resolving challenges encountered during the cycle. Project staff will provide technical, logistical and administrative support in the VSLA policies, processes and procedures. Further, they will build entrepreneurial capacities of the members in order to address the problem of limited livelihood options and low adaptive capacity caused by limited knowledge, skills and information.



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