Bolivia
Project Description
Five Talents' partnership in Bolivia began after two sisters attended a Five Talents training course on how to establish community managed savings and credit groups. For four years, Eva and Sara Mamani promoted the creation of rotating savings groups in their local community in Tarija, south central Bolivia. In 2008, Five Talents approved a partnership with the project which is now called 'Semillas de Bendicion' meaning "Seeds of Hope".
Five Talents is now supporting this initiative, aimed at helping people with no access to financial services, due to the lack of microfinance availability in the area. Semillas de Bendicion is supporting savings and credit groups in the town of Tarija, as well as groups in rural communities in the surrounding regions of El Puente, Entre Rios, Calamuchita and Valle Concepcion. Through the savings group structure, Semillas de Bendicion not only provides their clients with the opportunity to learn about saving an planning, but also helps them invest their money in different productive areas in order to improve their livelihood.
As they travel to visit communities and train them on how to set up their own rotating savings groups, Eva and Sarah also teach women how to dry leaves that are commonly available in the area, ground them into flour and turn them into noodles. In this way, they demonstrate to people in the community how they could practically establish their own micro-business.
Community Description
The project targets financially excluded communities in the Andean valleys of south central Bolivia. Rural poverty in Bolivia is concentrated in the high plains and in valleys, where it is estimated that poverty affects as many as 2 million people, 1.6 million of whom live in extreme poverty conditions. The majority of these rural inhabitants are of indigenous origin. The social groups that evidence the greatest levels of poverty and vulnerability are indigenous communities, women, and young people living in rural areas.
The majority of rural women work on family farms but their work does not receive sufficient economic or social recognition - therefore their access to capacity, credit, and technical assistance is limited. Their access to health and education services is also limited. The average number of years of schooling for rural women is only 2.5 years, while it is 4.7 years for men. Seasonal migration among men is very high in some regions of the country, which leaves women, in many cases, as heads of the household.
Target
Through this programme, Five Talents expects clients to gain business skills as well as the habits of saving and borrowing, which will enable them to participate in enterprise development. By the end of 2010, 28 groups in Tarija and rural locations had been formed serving 303 clients and positively impacting the lives of 1,515 people within the community. These groups are made up of people living in poverty, half of whom have small businesses and half of whom rely on seasonal labour opportunities. Thus far these groups have accumulated over £2,500 in savings, with a 100% repayment rate. There has also been training of 12 community facilitators who assist individuals who wish to be part of the community based savings and lending groups.
In 2011 Semillas de Bendicion plans to form 84 new groups in the six provinces of Tarija. They will train seven coordinators to cover these provinces whose role will be to form savings groups as well as serve as mentors for 12 groups amongst the provinces. By the end of 2011 they plan to reach 840 direct clients.
Semillas de Bendicion also plans to establish itself as a legal association with the Department of Tarija. The new legal constitution is currently being finalized and it is anticipated that it will be registered as an official non-profit organisation in Bolivia by the end of 2011.
Invitation
Please consider making a donation here.
Community Based Mechanisms for Financial Services: An Overview
Rotating Savings and Credit Associations (ROSCA)exist all over the world and have in various forms for generations. The typical ROSCA will have members join together to meet and save a fixed amount of money on a regular basis. At each meeting one member will receive the contributions of the group that day. The group determines in advance the amount of savings and the order in which it is given out. The process continues until each member has received their share. This method meets the needs of some groups in an efficient, transparent and cost effective way.
The Area Savings and Credit Association (ASCA) method takes the ROSCA format and adds flexibility to an efficient, transparent and cost effective user owned and managed organisation. In this structure, the group members create a fund from which group members borrow at predetermined interest rates and terms. The interest, fees and any fines in addition to member savings sustain and grow the loan fund. These organisations exist for a fixed period of time or can be on going; in ether case the return on the members' savings remains in the community. On the first day of the ASCA's formation it is sustainable because members manage the activities and profits benefit the members and stay in the local community.
More Information
Click here to read the latest programme summary on this project.
Click here to read the latest trip report.