How are savings groups changing lives?
A new study shows how having a safe place to save and borrow money can make a difference in rural Mali.May 13th, 2013 | by Anna Kramer
In the Segou region of Mali, 82 percent of households polled in a recent survey live on less than $1.25 a day. The typical village is more than 14 miles from a paved road. As a result, few people have access to resources that many of us take for granted—like a place to save and borrow money, for example.
Enter Saving for Change, an innovative program from Oxfam America, Freedom from Hunger, and the Strømme Foundation. Focusing on rural villages like those in Segou, the program trains groups of women to save regularly; they borrow from their group’s fund to build small businesses or homes, or to buy essentials for their families. Members then repay loans from the group with interest. The model has taken off, and Saving for Change now has 680,000 members in 13 countries in Africa, Asia, and Latin America. (Read what members in Guatemala and in Senegal are saying about their experiences.)
In Mali, where some of the first Saving for Change groups were founded, Oxfam and Freedom From Hunger conducted a three-year study exploring the impacts of the program. The results of the study, released last Friday, show that households in villages with savings groups experienced an 8 percent increase in food security and saved 31 percent more on average.
The groups helped in other ways, too. The study showed that the value of livestock held by households in participating villages increased by 13 percent compared to families in villages without the program. “Livestock are a critical safety net for families. The animals are a form of savings that can be sold in hard times. Imagine if your home value or stock portfolio increased by 13 percent—it could be game-changing for your family,” said Freedom from Hunger President Steve Hollingworth.