Project sets beneficiaries on the road to prosperity
Poor rainfall pattern resulting in perpetual hunger and inadequate disposable income compelled like-minded community members in Chikwatu Village, Traditional Authority Nyambi in Machinga to form a Village Savings and Loans Association (VSLA) in 2013.
The VSLA, named Yelodani, hoped to increase its income to enable members meet necessities at a household level.
But it was not to be. Disagreements regarding share-out and non-repayment of loans by some members slowed down the group's progress.
“We were a group with weak rules and at times members would get a loan without repaying it. This frustrated some members who ended up quitting the group,” says Tumale Sale, Yelodani VSLA chairperson.
Sale says the group almost disbanded until ActionAid Malawi introduced ‘Tilimbike’ project in late 2001 in the area. ActionAid Malawi is implementing the Tilimbike Project with support from Financial Access for Rural Markets, Smallholders and Enterprises (FARMSE) in Dedza and Machinga districts with a target reach of 37,500 households.
The goal of the project is to improve rural financial access to existing, new, and innovative informal and formal Community based Finance Organisation's products and services for poor but food secure households, households vulnerable to poverty, and resilient households.
The project is currently working with 1,639 VSLAs in the two impact districts of Machinga and Dedza. A total of 819 VSLAs are restructured ones, while 820 have been established with the facilitation of the project.
Sale explains that Tilimbike project was a timely intervention to the group that was on its deathbed.
“The project rejuvenated us. It trained us in group dynamics, loans and savings, and profit-making. That made us become well-organised and the continuous mentoring by the village agent and project facilitator is becoming key,” she remarks.
Following its successful restructuring, Yelodani grew in membership from 13 to 22, (18 women and four men) The group started saving, with shares ranging from MK500 to MK2000 per member. By December 2021, the VSLA’s savings grew to MK300 000.
“As a group, we decided not to share-out the savings but invest it further through rice and potatoes’ farming in the hope of realizing more income for the group. We identified and lented two hectors, each for rice and potatoes’ cultivation, respectively.
“As you can see, both crops are doing well and with the support of the project facilitator, we will search for a better market so can sell our produce at a better profit,” remarks Mercy John, another group leader.
John says the group hopes to raise a combined amount of K1.5 million from rice and potatoes sales in the next two months.
John’s hope is buoyed by Malawi Government’s recent announcement of minimum farmgate prices. According to the Ministry of Agriculture, the minimum price for unpolished rice is MK300 per kilogram. The current average price for sweet potatoes in the country is MK100 per kilogram.
“Our dream is to become one of the richest groups in the area through both VSLA and commercial crops. This is just the first step. We want to become a cooperative in future, and we are sure will get there someday,” she concludes.
Village Agent for the area, Patuma Kamphulutsa hails Yelodani VSLA for its unity and is confident the group is destined for greatness. Kamphulutsa, who supervises 20 VSLAs in the Traditional Authority Nyambi, says the group will however need support from other stakeholders such as government and the private sector to fully realise its dream.
“With necessary support such as extension services and linkage to good markets, this group will graduate from poverty to prosperity in the next few years,” she says.