Participants in a group pose

Participants at the end of an international forum in Accra on Sustainable Microfinance Development Programme, SMDP, have called for innovative methods to scale up activities of Savings Groups to facilitate their linkage to formal financial institutions. They noted that this linkage will address the challenge where rural people find it difficult to access credit to establish micro businesses to improve their socio-economic life.

The SMDP which was jointly organised by VSL Associates Limited in Solingen in Germany and Microfin Consult of Ghana was in partnership with the University of New Hampshire, USA and MasterCard Foundation. The participating countries were Ghana, Sierra Leone, Nigeria, Cote D’Ivoire, Rwanda, Uganda, Zimbabwe and Mozambique.

Some of the participants told GBCONLINE and Radio Ghana’s Bright Kofi Agamah that the programme has energised them to be more passionate in pursuing empowerment agenda for the marginalised who struggle to access credit to improve on their living conditions.

A Marketing Officer from Ghana working with Microfin Rural Bank Limited, Augustina Aryee, was delighted about the training topic on ‘”Meeting Procedure” used by Savings Groups. According to her “there is a procedure that Savings Groups follow to contribute their savings, give loans and repay the loan. Such procedures, when adhered to help to build stronger Savings Groups.”

The Linkage Coordinator with Microfin Plus in the Central Region, Ghana, Mr. Alfred Akorful, said the training has enhanced his skills to facilitate the opening of accounts by savings groups with the formal Financial Institutions for safe keeping of their money. He disclosed that out of the one thousand, three hundred and fifty-four Savings Groups across Central Region, Microfin Plus has so far linked more than five-hundred to Microfin Rural Bank.

For Silas Gmagnel, the Managing Director of Salt Savings Programme in Northern Ghana, the SMDP actually taught him different ways in the savings programme. “We actually had a weakness on how to draft the Constitution on our savings groups but I think my capacity has been built here now. When I get back I will be able to draft a constitution to safeguard the groups and their resources” he stated.

A representative of the Bank of Ghana emphasized that SMDP training has been an eye opener for her to know more about Savings Groups, stressing “it is always good to understand the basic concepts then you are better informed when you are creating the needed regulatory enabling environment.”

The foreign participants stressed the need to step up such training programmes to empower people in rural communities in Africa. Mary Bature from Plateau State in Nigeria noted that the training has enlightened and motivated her to step up activities on how to encourage the culture of savings among their clients. “But with this training I found out that the ones we have on the ground (owners of small businesses) can be trained in the processes of saving and they can even raise funds to liberate our people from poverty.”

A participant from Cote D’Ivoire, and the Project Manager at Care International, Gadou Leopodine was enthused about the VSL Associates methodology and planning tool and how to integrate them into financial services to help in the empowerment agenda of the disadvantaged in society.

The Country Director of Seed Effect in Uganda, Mr. James Lomude in a general assessment, described the programme as a success. He was happy to note that Savings Groups continue to be a rallying point for bringing together the marginalised to appreciate savings as critical to economic empowerment. He identified three major things that one will enjoy by being a member of a savings group. These are the savings itself, and the members’ opportunity to borrow from their savings. Members can also take insurance cover. He added that “in addition to that there are other services where the groups can get some training on income generating activities and record keeping.”

Emelina Murrure, from Mozambique and a worker at World Education said the training has equipped her with more knowledge on how savings groups can be successful. She said, “we have gained more knowledge on how we can run or promote good savings groups and how we can link them to micro-finance institutions. These savings groups are improving the livelihood of poor people because most of the poor people don’t have money to save but through this savings groups, we have found out that poor people can save and change their lives.”

In an interview, the Chief Executive Officer of Microfin Consult Ghana, Mr. Ishmael Otchere, emphasised the need to promote Savings Groups because of their critical role in improving financial inclusion in the rural areas. He maintained that the sustainability of savings groups will improve money circulation in the rural economy, and stressed that “Savings groups design is done such that there is an element of sustainability because it is normally funded by donors to give the kind of capacity building, train the rural folks to be able to undertake such informal financial service among themselves, when the donor projects come to an end.”

Mr. Otchere added that savings groups are useful tools for financial inclusion, and typically work for deprived rural areas where access to finance is very challenging.

The Lead Facilitator at the Accra training session of the SMDP and Chief Executive Officer of VSL Associates, Mr. Hugh Allen in his closing remarks said the challenge linking Savings Groups to formal financial services is considerable and it requires a really mature set of savings groups that are beginning to be more ambitious. It also requires those who have begun to appreciate that the risks they face with a lot of money in the communities need a solution which can be supplied by formal sector banking institutions. “But the evidence seems to be emerging that there is a very strong preference of keeping capital on the part of rural communities itself, which in a way is understandable because that is where they feel it can be most productively spent.” Mr. Allen observed.


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