Month: September 2019

Sokoloka SILC Group in Mwense rural district has called on government through the Ministry of Agriculture to consider supporting SILC Groups through the Farmer Input Support Programme (FISP).

Speaking when the RUFEP team and Programme Steering Committee (PSC) members visited the group in Mwense with staff from the Catholic Diocese of Mansa (CDM), Sokoloka SILC Group Secretary Joseph Mungole urged government through the Ministry of Agriculture to recognize SILC just like cooperatives.

Mr. Mungole said SILC Groups also need support from the government’s Farmer Input Support Programme (FISP) under the Ministry of Agriculture just like the cooperatives.

“The same way government through the Ministry of Agriculture provides FISP to the Cooperatives, we also want to be assisted. If Cooperatives receive inputs from government, what about the SILC groups?” he asked.

Responding to the question, Ministry of Agriculture’s Director Agribusiness and Marketing Mrs. Keziah Katyamba advised that SILC groups need to be formalized through registration to access support from government.

Mrs. Katyamba said it was gratifying to see that SILC groups were self-reliant and growing without depending on government. She urged Sokoloka SILC Group members not to wait for government but to use their savings to buy inputs, or embark on income generating activities for the group such as buying a hammer mill.

And Ministry of Finance’s Investment and Debt Management Director Mr. Jacob Mkandawire echoed that self-reliance evidenced from the operations of the SILC groups was the best form of empowerment as individuals and group members know what works better for themselves.

“We have heard cases where FISP inputs are given out to support farmers but some people decide to sell the inputs to do fishing instead. It is you who knows the best you can do for yourself”, Mr. Mkandawire said.

He said the PSC members were happy to hear testimonies from Sokoloka SILC group members that from the group savings, members were able to buy agricultural inputs, pay school fees and improve their houses. Mr. Mkandawire added that government wants to see that SILC Groups grow and graduate and was willing to provide support where there was need.

Sokoloka SILC Group was started in April 2018 and has a membership of 32 (25 women and 7 men). The SILC Group was created by the Private Service Provider (PSP) supported by CDM’s Expanding Financial Inclusion in Luapula (EFIL) project financed by RUFEP under the CBFIs linkages window.

During the last share-out, in December 2018, the group shared about ZMW40, 000 .00. By the month-end of August 2019, the group savings and the loan funds had amounted to about ZMW60, 000.00 and the group is due for share-out by October 2019 in readiness for the farming season.

 

Africare has partnered with Madison Finance to link SILC Groups in Luapula under the Insansa Rural Finance Project supported by RUFEP’s Community Based Financial Institutions (CBFIs) Linkages Window to mobile banking.

Under this initiative, Africare has linked about 1,342 individuals belonging to SILC Groups in Mansa, Chembe and Mwense to Madison Finance’s digital group savings product called ‘Chilimba account’ which is integrated to Madison Finance’s mobile banking system.

Madison Finance’s digital group savings product has the Chilimba account for the SILC groups, and the Savings account for individual members’ mobile phones to access mobile banking services and other financial services.

Managing Director Titus Waitaka disclosed that Madison Finance has recruited mobile bank agents who are in direct contact with the SILC groups supported by Africare and Catholic Diocese of Mansa in peri-urban and rural areas of Luapula province.

Mr. Waitaka said the product makes it easier for individuals to make mobile payments and transactions with the groups account (Chilimba) adding that the partnerships aims to change the saving culture of the SILC groups under the pilot without changing the SILC methodology.

Speaking during the field visit by RUFEP Team and the Programme Steering Committee (PSC) to the linked SILC Groups (Chipala, Kosapo and SMAG) under Africare at Mano Rural Health Centre, Mansa District, he said Madison Finance was currently piloting the savings platform before activating the loan platform.

“We are giving SILC Groups some months to learn about saving. We do not want to confuse savings with loans. As they continue saving and transacting using their mobile phones, they are generating a credit history which will be useful for managing both the group and individual loans”, Mr. Waitaka said.

While the savings account for individuals attracts no monthly and withdrawal charges, there is a minimum activation charge of ZMW20.00. From the savings account, individuals are able to pay bills such as electricity, buy airtime, insurance and access other financial services on Konse Konse.

Meanwhile, Chipala SILC Group deposited ZMW13, 400.00 on the 1^st August 2019 into a six months fixed deposit account with Madison Finance which is expected to earn (ZMW952.13) interest at 14.25% per annum for the group by sharing out period in January 2020.

Speaking during the field visit, Ministry of Finance’s Investment and Debt Management Director Jacob Mkandawire said government was keen to learn more from the interventions aimed increasing rural financial inclusion.

Mr. Mkandawire said the PSC members were happy to interact directly with partners and beneficiaries of the RUFEP programme adding that the field visits had given the PSC an opportunity to have firsthand information on what is going on in the field.

 

Mapalo Savings and Internal Lending Communities (SILC) group is one of the Community Based Financial Institutions (CBFIs) based in Mansa that has been linked to Cavmont Bank under the Expanding Financial Inclusion in Luapula (EFIL) project of the Catholic Diocese of Mansa (CDM).

The CDM accessed a matching grant from RUFEP under the CBFIs linkages window of the Innovation and Outreach Facility (IOF), to provide capacity building to SILC Groups in Luapula and to link them to formal financial institutions.

Following the linkage with Cavmont Bank, Mapalo SILC group initially deposited ZMW 500.00 which has since been withdrawn leaving a balance of ZMW50.00 only. With a membership of 30 women, Group members disclosed that their motivation to open a bank account with Cavmont Bank was to access loans from the bank.

However, Mapalo SILC Group members found it a challenge to save more money in their Cavmont account as much of their savings were loaned out to group members while nothing remained in the box to deposit in the bank account with Cavmont.

In addition, group members disclosed that the turn-around time for depositing money in the bank towards the share out period was limited to earn the group sufficient interest on their savings.

“If we are to take ZMW10, 000.00 to the bank, the same money is what group members need to borrow. So we can only save a small amount such as the Social Funds in the bank account”, Mapalo SILC Group member Joan Chifumbe disclosed.

Predominantly informal, Savings Groups are increasingly providing a sustainable source of financial empowerment for rural communities particularly for the poor people who are financially excluded.

Mapalo SILC Group members were taught how to save and invest their loans wisely on income generating activities with the support of the Private Service Providers (PSPs) recruited by the Catholic Diocese of Mansa (CDM) under the EFIL Project.

According to group members, belonging to a SILC group has now made it easier for members to access finances for investing in income generating activities.

Mapalo SILC Group member Loveness Musunga disclosed that it used to be a challenge for her to borrow money from individuals because of high interest rates which were charged sometimes at 100%.

“With the SILC groups, we have learnt how to save together as a group and access loans to invest in income generating activities. We had no knowledge on the difference between capital and profit but now we have learnt how to save and invest”, Mrs. Musunga said.

She added that through her business and savings from the SILC group, she has managed to sponsor herself to school and improved the family house.

This was when a delegation of the RUFEP staff and Programme Steering Committee (PSC) members visited SILC Groups promoted by RUFEP partners in Mansa under the CBFI linkages window from the 29^th and 30^th August, 2019.

Bwafwano Savings and Internal Lending Community (SILC) Group is one of the Community Based Financial Institutions (CBFIs) in Mansa being promoted by the Catholic Diocese of Mansa.

With a group membership of 32 (30 women and 2 men), the group has managed to save over ZMW300, 000 from members by the end August 2019. However the group is not linked with any financial service provider in Mansa to secure their savings in the box particularly towards the sharing out period when funds accumulate in the box.

Group Treasurer Jennifer Zulu (not real name) said the risk of keeping huge sums of money in the box is mitigated as savings are loaned out to group members during the large part of the saving cycle.

However, Jennifer disclosed that the risk of keeping huge sums of money in the box increases towards the sharing out period as most group members by then are paying back their loans.

“Savings and lending are done weekly every Thursday while loan repayments are due within 30 days at 20% interest. According to our constitution, the maximum loan amounts per individual member should not exceed three times the amount saved by the member”, she said.

This was when a delegation of RUFEP staff and Programme Steering Committee (PSC) members  visited Savings Groups promoted by RUFEP partners in Mansa under the CBFI linkages window from the 29^th and 30^th August, 2019.

The PSC members included Ministry of Finance (MOF)’s Investment and Debt Management (IDM) Director Mr. Jacob Mkandawire, IDM Senior Economist Nchimunya Shatontola, Rural Finance Unit (RFU) Assistant Director Mr. Derrick Simukoko and RFU Principal Economist Mrs. Brenda Chanda.

Others members of the PSC were Ministry of Agriculture’s Director, Agribusiness and Marketing, Mrs. Keziah Katyamba and Bank of Zambia’s Assistant Director for Regulatory Policy and Licensing Mr. Mbinga Kafunya.

The RUFEP Team included the Programme Coordinator Mr. Michael Mbulo (PSC Secretary), Monitoring and Evaluation Specialist Mrs. Womba Phiri, International Technical Advisor Mr. Gareth Evans and Knowledge Management and Communications Specialist Mr. Cephas Moonga.

The main objective of the field visits was familiarize the PSC members on the interventions happening in the rural areas by RUFEP’s implementing partners.

The Catholic Diocese of Mansa is implementing the Expanding Financial Inclusion in Luapula (EFIL) Project targeting 10,000 beneficiaries under the CBFI linkages window of RUFEP’s Innovation and Outreach Facility (IOF).

Speaking on behalf the PSC Chairperson Dr. Emmanuel Pamu (Ministry of Finance Permanent Secretary), IDM Director Jacob Mkandawire said the committee was happy to see the groups being organized by RUFEP’s implementing partners in Luapula.

Mr. Mkandawire added that the Ministry of Finance was keen to see that these groups grow to improve the livelihoods of the rural people and to reduce poverty in communities.