Microfinance innovations in Zimbabwe

Counting savings Counting savings CARE / Tine Frank

A survey conducted by the National Task Force on Microfinance in 2006 reported that 70 per cent of the economically active population in Zimbabwe did not have access to formal financial services, a figure that is thought to be even lower today.  As Village Savings and Lending Associations (VSLA) groups mature, and have improved entrepreneurial skills, need for linkages with formal microfinance service providers for purposes of accessing additional loan capital for growing and diversifying enterprise development activities is evident.

In response to this need, the IMF project seeks to link mature groups, who have demonstrated financial literacy and successful development of income generating activities through their VSLA, to formal micro-finance institutions.  Simultaneously the project is assisting formal micro-finance institutions to develop sustainable microfinance products that meet the needs of, and are accessible to, the poor. The IMF is a pilot project which aims to ensure clients’ access to suitable microfinance product(s) (to promote continued economic gains), mitigate risk for the clients and the institutions, and capture any lessons for consideration into future programming.

The specific goal of the project is: to support private sector Microfinance Institutions in the development of pro-poor micro-finance products in Zimbabwe and facilitate linkages between the MFIs and established ISAL groups.

The specific purpose of the project will be: To support the development of sustainable microfinance product(s) that meet(s) the needs of, and is accessible to, ISAL clients.


In summary the key project activities include;

  • Engaging an MFI partner (Virl) for development of appropriate finance products for ISAL groups and a local partner (Chitungwiza Utano Public Health Trust, CUPHT) who is already working with CARE in the establishment and support of ISAL groups in Chitungwiza
  • Assessing the financial services needs of rural urban ISAL clients
  • Developing and testing an appropriate urban financial service product or products
  • Preparing urban ISAL clients for accessing financial services
  • Documenting and sharing lessons with the wider MFI and NGO communities:
  • Countries: Zimbabwe
  • Area: Chitungwiza, 30kms south of Harare
  • Start Date: April 2011
  • End Date: March 2012
  • Donor: GRM (DFID Protracted Relief Programme II)
  • Funding Total: £200,000

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