My first visit as CEO of CARE International UK was to Rwanda to see our work with VSLAs. It was here I met Olive, a mother of two and originally a teacher from Kenya but now living in the rural eastern village of Gishari in Rwanda. When she first moved to Gishari, Olive said she felt lonely and faced challenges given she had little income, lives with a disability and is a widow.
Life changed when she joined her local VSLA. She saw a business opportunity in that there was no nursery in the village. Women had to take their children into the fields with them or worry about leaving them at home. The VSLA supported Olive’s application to the government to open a nursery, lent her £80 for materials and provided entrepreneurship training through a CARE local partner. Soon she had 35 children paying £2 per month to attend her nursery and had repaid the loan.
As well as creating income for herself and the three employees she hired, Olive’s nursery has helped other women in the village work and earn a living. Most movingly, Olive no longer felt lonely and felt recognised by her community.
Today more than 26 other NGOs and governments have replicated CARE’s model, helping to reach at least 15 million people! CARE’s VSLA members are increasing their financial skills and there is evidence they – like Olive – are on the ladder to economic, social and political empowerment. An RCT study of CARE’s VSLAs in Ghana, Malawi and Uganda showed statistically significantly increases in women’s access to savings and loans, in women’s business income and ownership, in food provision, and in women’s influence over household and business decisions.
VSLAs are a proven pathway to formal financial inclusion too. Our work with partners including Mondelēz, Barclays, National Microfinance Bank Tanzania, Equity Bank and many others have helped 1.3 million members open their first bank accounts, increasing group security, women’s control over resources and the return on investment members achieve each year.
Results like these are what led the UN High Level Panel on Women’s Economic Empowerment to acknowledge that VSLAs are an accelerator to women’s informal and formal financial inclusion and overall empowerment.
All this prompts us to ask the question: “how many more women and girls around the world could potentially benefit from participating in a VSLA?”
As we commented on recently, despite widespread and longstanding acknowledgement of the need to close the gender gap in access to formal financial services, the global community has made virtually no progress in achieving this. On this metric alone, we see a need for more deliberate focus on scaling solutions that have been proven to close this gap and more broadly support equality and empowerment.
Focusing on countries with the lowest human development index scores, highest rates of gender inequality and largest overall populations of women and girls living in poverty, we estimate there are more than 600m women and girls in 44 countries who could potentially benefit from joining a high quality VSLA:
What would it take to reach 605 million women and girls with savings groups? One thing is clear – business as usual will never get us there. Empowering 600m women and girls to realise the sorts of impact Olive was able to achieve is both a challenge and an opportunity.
Progress will demand diverse partnerships across the savings group sector, including leadership by policy makers and companies to increase the scale, sustainability and impact of VSLAs and groups like them.
CARE is excited about the SG2018 conference which we are proud to sponsor, and we are committed to continuing to work together to develop and pursue approaches that can do justice to the opportunity before us.