performance of village saving and loan associations …

A

MAKERERE UNIVERSITY

PERFORMANCE OF VILLAGE SAVING AND LOAN ASSOCIATIONS AND

ECONOMIC EMPOWERMENT OF MEMBERS

CASE OF AKADOT PARISH MUKUJU SUB-COUNTY TORORO

BY

ANGETA WILFRED

07/U/6650/EXT

207015059

SUPERVISED BY

MR BAKUNDANA MARTIN

A RESEARCH REPORT SUBMITTED IN PARTIAL FULFILLMENT OF THE

REQUIREMENT FOR THE AWARD OF A BACHELOR OF COMMERCE

DEGREE OF MAKERERE UNIVERSITY

JUNE 2011

i

Declaration

I declare that this research work is my original work and has not been published or

submitted for the award of any discipline to any university or any higher institution of

learning before. Where it is indebted to the work of others due acknowledgement has

been made

Signed…………………… Date………………………

ANGETA WILFRED

STUDENT

ii

Approval

This report has been submitted for examination with my certification and approval as a

university supervisor.

Signed …………………… Date………………………

Mr. Bakundana Martin

Supervisor

iii

Dedication

I dedicate this report to the family of Mr. and Mrs. Obbo Kenneth, you brought me this

far. God bless you

iv

Acknowledgement

I am grateful to God almighty for His mercy, for giving me a healthy mind, life and

wisdom to be able to produce this work and most importantly to go through the course.

I am heavily indebted to the family of Mr. and Mrs. Obbo Kenneth for the financial

support, encouragement and guidance that has enabled me to successfully go through the

course.

I express my sincere gratitude to my supervisor Mr. Bakundana Martin for his

constructive criticisms, guidance, encouragement, devotion and timely response without

which I would not have been able to produce this dissertation

I am indebted to my brother Habryarimana Christopher for the financial support and

accommodation he accorded to me during data collection. Thank you brother may God

bless you abundantly.

I thank Mr. Oleng Raphael for his help during data collection

I thank the community of Akadot parish especially those who responded to my

questionnaire, thank you for sparing your valuable time and allowing me to access

information from you.

I am indebted to my friends; Maneshe Shamim, Robert, Damba Paul, Charity, Lukanga

Janet, Apophia, Dinah, Gule, Stephen Onyangai, and many others for their company and

encouragement through the course. Thank you all.

v

Table of contents

Page no.

Declaration ....................................................................................................................... i

Approval .........................................................................................................................ii

Dedication ..................................................................................................................... iii

Acknowledgement .......................................................................................................... iv

Table of contents ............................................................................................................. v

List of tables .................................................................................................................... x

Abbreviations and acronyms ......................................................................................... xii

Abstract ........................................................................................................................xiii

CHAPTER ONE ............................................................................................................. 1

INTRODUCTION ........................................................................................................... 1

1.1 Background ............................................................................................................... 1

1.2 Problem statement ..................................................................................................... 2

1.3 Purpose of the study .................................................................................................. 3

1.4 Objectives of the study .............................................................................................. 3

1.5 Research questions .................................................................................................... 3

1.6 Scope of the study ..................................................................................................... 4

1.7 Significance of the study ............................................................................................ 4

CHAPTER TWO ............................................................................................................ 5

LITERATURE REVIEW ................................................................................................ 5

2.1 Introduction ............................................................................................................... 5

2.2 Performance of VSLA ............................................................................................... 5

2.2.1 Number of clients ................................................................................................... 5

vi

2.2.2 Loans and savings volume ...................................................................................... 6

2.2.3 Arrears and loan default .......................................................................................... 6

2.2.4 Transparency and Accountability ............................................................................ 7

2.2.5 Action Audit ........................................................................................................... 7

2.2.6 Shared Responsibilities ........................................................................................... 9

2.2.7 Profitability ............................................................................................................ 9

2.3 Economic empowerment ......................................................................................... 10

2.3.1 Access to credit .................................................................................................... 11

2.3.2 Income and consumption ...................................................................................... 11

2.3.3 Savings ................................................................................................................. 12

Uses of saving payout .................................................................................................... 13

2.4 Performance of VSLA and economic empowerment of the members ....................... 13

2.5 Conclusion .............................................................................................................. 14

CHAPTER THREE ....................................................................................................... 15

METHODOLOGY ........................................................................................................ 15

3.1 Introduction ............................................................................................................. 15

3.2 Research strategy and design ................................................................................... 15

3.3 Study population and sample size ............................................................................ 15

3.4 Sampling design, methods and procedure ................................................................ 16

3.4.1 Sample design and method ................................................................................... 16

3.4.2 Sampling procedure .............................................................................................. 16

3.5 Sources of data ........................................................................................................ 16

3.6 Methods of data collection ....................................................................................... 16

3.6.1 Self administered questionnaires ........................................................................... 16

vii

3.6.2 Semi-structured interview ..................................................................................... 17

3.6.2 Participant observation ......................................................................................... 17

3.7 Data processing, analysis and presentation. .............................................................. 17

3.7.1 Data processing .................................................................................................... 17

3.7.2 Data analysis ........................................................................................................ 17

3.7.3 Data presentation .................................................................................................. 18

3.8 Limitations of the study ........................................................................................... 18

CHAPTER FOUR ......................................................................................................... 19

PRESENTATION, ANALYSIS AND DISCUSSION OF RESEARCH FINDINGS ..... 19

4.1 Introduction ............................................................................................................. 19

4.2 findings on demographic information of the respondents ......................................... 19

4.2.1 Findings on gender of the respondents .................................................................. 19

4.2.2 Findings on age bracket of the respondents ........................................................... 20

4.2.3 Findings on the marital status of the respondents .................................................. 20

4.2.4 Findings on the Education Background of the respondents .................................... 21

4.2.5 Findings on Occupation of the respondents ........................................................... 21

4.2.6 Findings on Average Income of the respondents ................................................... 22

4.2.7 Findings on VSLA membership ............................................................................ 22

4.2.8 Findings on whether one holds leadership position in VSLA................................. 22

4.2.9 Findings on leadership type .................................................................................. 23

Findings on the performance of village savings and loans association ............................ 23

4.3.1 There is a high volume of savings and loans in VSLA .......................................... 23

4.3.2 There are loan arrears in the group at the end of each cycle ................................... 24

4.3.3 Most members of the group default on there loans ................................................ 25

viii

4.3.4 There is transparency in the group and accountability is done regularly ................ 25

4.3.5 The group carries out action audit where members are paid back there savings plus

interest .......................................................................................................................... 26

4.3.6 Every leader in the group has a defined role which is different from others. .......... 26

4.3.7 Village savings and loans association are highly profitable ................................... 27

4.4 Findings on the economic empowerment of VSLA members. .................................. 27

4.4.1 Accessing funds/loans is easier with village savings and loans association ............ 28

4.4.2 joining the saving group has contributed to the increase in the level of my income

and consumption. .......................................................................................................... 28

4.4.3 VSLA has enabled me to improve on my savings culture ...................................... 29

4.4.4 I use my savings pay out in the best way possible ................................................. 29

4.4.5 VSLA has enabled me to pay school fee ............................................................... 30

4.5 Findings on the performance of VSLA and economic empowerment of the members

...................................................................................................................................... 30

4.5.1 Funds / loans accessed from VSLA has helped to improve my economic status .... 30

4.5.2 It is better to join VSLA than not being a member. ............................................... 31

4.6 The relationship between performance of VSLA and economic empowerment of

members ........................................................................................................................ 31

CHAPTER FIVE ........................................................................................................... 33

SUMMARY, CONCLUSION AND RECOMMENDATIONS OF STUDY .................. 33

5.1 Introduction ............................................................................................................. 33

5.2 Summary of findings ............................................................................................... 33

5.2.1 Summary on performance of VSLA ...................................................................... 33

5.2.2 Summary on economic empowerment of members ............................................... 33

5.2.3 Summary on performance of VSLA and economic empowerment of members ..... 33

5.3 Conclusions ............................................................................................................. 34

ix

5.3.1 To evaluate the performance of VSLA in Akadot parish ....................................... 34

5.3.2 To examine the extent of economic empowerment of VSLA members in Akadot

parish. ........................................................................................................................... 34

5.3.3 To establish the relationship between performance of VSLA and economic

empowerment of members............................................................................................. 34

5.4 Recommendations ................................................................................................... 34

5.5 Areas for further research ........................................................................................ 35

References ..................................................................................................................... 36

Appendices.................................................................................................................... 38

x

List of tables

Page No.

Table 4.2.1 showing finding on gender of respondents………………………………….19

Table 4.2.2 showing finding on age bracket of respondents…………………………..…20

Table 4.2.3 showing finding on marital status of respondents………………………..…20

Table 4.2.4 showing finding on education background of respondents………………....21

Table 4.2.5 showing finding on occupation of respondents………………………….….21

Table 4.2.6 showing finding on average income of respondents………………………...22

Table 4.2.7 showing finding on VSLA membership………………………………….....22

Table 4.2.8 showing finding on whether one holds leadership position in

VSLA…………………………………………………………………………………….23

Table 4.2.9 showing finding on leadership type………………………………………....23

Table 4.3.1 showing finding on whether there were high level of savings and loans...…24

Table 4.3.2 showing finding on whether there were loan arrears………………………..25

Table 4.3.3 showing finding on whether members defaulted on their loans…………….26

Table 4.3.4 showing finding on transparency and accessibility in VSLA……………….26

Table 4.3.5 showing finding on VSLA groups carried out action audit………………....27

Table 4.3.6 showing finding on leadership roles……………………………………...…28

Table 4.3.7 showing finding on profitability of VSLA……………………………….…28

Table 4.4.1 showing finding on accessibility of loans…………………………………...29

Table 4.4.2 showing finding on if joining VSLA contributed to improvement in the

member’s income and consumption……………………………………………………..30

Table 4.4.3 showing finding on whether joining VSLA improved member’s saving

culture……………………………………………………………………………………30

Table 4.4.4 showing finding on whether VSLA members put their savings pay out into

best use…………………………………………………………………………………...31

xi

Table 4.4.5 showing finding on whether funds from VSLA were used to pay school

fees……………………………………………………………………………………….31

Table 4.5.1 showing finding on whether VSLA had improved members economic

status……………………………………………………………………………………..32

Table 4.5.2 showing finding on whether it was better to join VSLA than not being a

member…………………………………………………………………………………..32

Table 4.6 showing correlation of the topic variables………………………………….....33

xii

Abbreviations and acronyms

VSLA Village Savings and Loans Association

ASCA Accumulating Savings and Credit Associations

MFI Micro Finance Institution

IGA Income Generating Activity

UPE Universal Primary Education

USE Universal Secondary Education

xiii

Abstract

This work contains a study of performance of VSLA and economic empowerment of

members, it was guided by the following objectives; to evaluate the performance of

village group saving and loan associations, to examine the extent of economic

empowerment of the members of village group saving and loan associations, to establish

the relationship between the performance of VSLA and the economic empowerment of

the members. The study was carried out in Akadot parish Mukujju Sub County in Tororo

district focusing on VSLA groups and members of VSLA.

The respondents were selected randomly. Data was collected using questionnaire,

interview methods and supplemented by information from records.

A significant relationship between performance of VSLA and economic empowerment

of members, performance and economic empowerment had a strong correlation , The

groups were characterized with high profitability levels, groups had no loan arrears, no

defaults on loans, there was transparency among group members and all the groups

carried out action audit and paid their members, Members had benefited from the savings

services offered by the VSLAs and majority were satisfied with the security of their

money, the incentive to accumulate money in affordable amounts and the opportunity to

get lump-sum payouts with profits at the end of the cycle.

Basing on above findings, the following recommendations were made; VSLA groups

should maintain the methodology of operation, Business training skills should be

extended to the group members to ensure that income generating activities are promoted

at individual household level.

1

CHAPTER ONE

INTRODUCTION

1.1 Background

Village savings and loans associations (VSLA) are time-bound accumulating savings and

credit associations (ASCAs). ASCAs already exist in most African countries, although

the time bound ASCAs are much rarer. Members of a VSLA group of up to 30 persons

save regularly and borrow from the group fund. The borrowers must repay the loan with

interest, usually after between one and three months. The group is formed for a specific

cycle (usually 12 months) and set with a specific objective, such as a religious holiday or

the beginning of school. At the end of the cycle the total fund is divided among members

based on their savings (shares) contributions. After the fund has been paid out, the groups

normally immediately re-form with members having the right to leave, new members are

enrolled and inducted then the group starts a new cycle of savings and lending. Allen

(2006), Grant and Allen (2002)

According to Mr. Oleng Raphael a community based trainer, VSLA in Tororo district

begun in 2003 initiated by Plan International and Implemented by Community Vision an

NGO. In Akadot Parish, the program started in January 2006 with 7 groups, people did

not pick up the new model fearing the loss of their money since other MFIs had robbed

them of their money. Later in 2007 when the community saw that those who joined

VSLA had benefited from the model, different community members started joining

VSLA. The groups only share costs for the tool box kit and there are no other hidden

costs.

2

The study looked at performance in the following dimensions, profitability of the groups,

number of clients, financial performance of the groups including loans and savings

volumes, arrears and defaults, power relations within the groups which brings in issues of

governance, transparency and accountability

The level of economic empowerment was examined through the following dimensions;

income level of the users of VSLA to examine the application of the funds obtained from

the VSLA which directly affects their (users) ability to pay back the funds borrowed,

economic independence, property acquisition, management and control of resources and

savings accumulation The study finally looked at how the performances of the groups

affect the economic empowerment of the member

1.2 Problem statement

Care Uganda promotes the VSLA model under CARE’s strategic direction to promote

the economic rights of poor and marginalized people through piloting and sharing lessons

learnt from innovative economic development initiative and advocating for effective

policies and practices and promotion of VSLA methodology emphases the creation of

savings which builds the asset base of the poor and consequently reduces their

vulnerability to livelihood shocks , as compared to an emphasis on formal loans from

MFIs which may increase poor people’s risk. VSLA model provides sustainable and

profitable savings, insurance and credit services to the people (CARE Uganda, Plan)

According to Mr. Oleng Raphael a community based trainer with Plan International

based in Akadot parish, the community in Akadot parish adopted the model of VSLA in

early 2006 and many groups started mushrooming up but of late many people have lost

3

their property, houses/ homes have been broken, some people have fled their homes and

others have gone back to even worse state of poverty than they were before.

Despite the promise of the VSLA to attain outreach to very poor and rural people better

than formal centralized micro finance institutions in order to empower and improve the

lives of the communities, in this case the opposite is seen.

1.3 Purpose of the study

The research was to study the performance of village group savings and loan associations

and the economic empowerment of the members in Akadot parish.

1.4 Objectives of the study

1. To evaluate the performance of village savings and loan associations in Akadot parish

2. To examine the extent of economic empowerment of the members of village saving

and loan association in Akadot parish

3. To establish the relationship between the performance of village savings and loan

associations and the economic empowerment of the members.

1.5 Research questions

1. What is the performance of village savings and loan association in Akadot parish?

2. What is the economic empowerment of the members of village saving and loan

association in Akadot parish?

3. What is the relationship between the performance of village savings and loan

associations and the economic empowerment of the members?

4

1.6 Scope of the study

The study was carried out in Akadot parish Mukujju Sub County- Tororo district. The

research covered a period between 2006 -2010 to study the performance of village

savings and loan association and economic empowerment of the members in Akadot

parish.

1.7 Significance of the study

The study is useful in the following ways

1. The study provide information to the villagers about the best ways to spend money

obtained from village group savings and loan associations

2. Local leaders as policy makers will the need to intervene in the matters of the village

group savings and loan association most especially when disputes arise among the

members

3. The study will help the government to be interested and thus design regulations to

govern village group savings and loan associations in Uganda

4. The research provides information to other researchers who want to carry out research

in a similar area.

5

CHAPTER TWO

LITERATURE REVIEW

2.1 Introduction

This chapter focuses on the performance of village group saving and loan associations

and the economic empowerment of the members. The following are covered:

performance of VSLA looking at number of clients, loans and savings volume, arrears

and loan defaults, transparency and accountability, action audit, shared responsibility and

profitability, economic empowerment of VSLA members in terms of access to credit,

income and consumption, savings, uses of savings pay out as well as the relationship

between the two variables has also been covered

2.2 Performance of VSLA

According to Anyango (2006) in a study of VSLA in Zanzibar performance is measured

using the following parameters; profitability of VSLA, number of clients, loans and

savings volumes, arrears and loan defaults, how membership changes, literacy level of

leaders, power relation in the group which brings in the issue of transparency and

accountability.

2.2.1 Number of clients

According to The New Vision of Wednesday February 27th

2008, article Uganda

promotes access to financial services in rural Uganda, 70% of the total membership in

VSLA was women and the article also showed that 4342 groups were formed in total.

This therefore implies that VSLA is not a methodology that is designed for growth

oriented entrepreneurs.

6

2.2.2 Loans and savings volume

According to the study carried out by DFID and Plan International (2006-2007) it was

reported that in a typical VSLA, weekly savings range from Uganda shillings 200 to

Uganda shillings 2500 set by the group. Members are allowed to save up to five times the

minimum amount but no more. The report also indicates that loan period range from 1

week to three months. Loan arrangement and disbursement is made by all the group

members during their group meetings.

Mutesasira and Nthenya (2003) in their study of savings group in West Nile- Uganda

observed that loans range from US dollars 2.30 –US dollars 25 while savings ranged

from US dollars o.10 to US dollars 0.50 weekly per member. Both the small size of the

required savings contributions and the flexibility in sizes were important factors in

supporting depth of outreach.

2.2.3 Arrears and loan default

According to a report by CARE International in Uganda VSLA workshop held on 25th

-

27th April 2006, it was seen that VSLA methodology has low tolerance of arrears.

This aims at instilling a culture of savings among group members and ensuring that there

is no fund loss to defaulters.

All arrears should be publicly acknowledged in group meetings and in general the

percentage of borrowers in arrears should not be encouraged.

7

Community owned and managed groups tend to stop functioning as a result of default or

fraud that erode the asset base of the group and often reflect dysfunctional group

dynamics Anyango (2006). It is often argued that these problems stem from lack of

literacy and numeracy skills and lack of these skills can certainly produce failures in book

keeping and compliance with policies. Anyango further argues hat problems arise from

un equal power relation within the group that produce failure in governance for example

a few leaders may be very dominate and influence the allocation of group resources,

leading to exploitation of the less powerful, for instance taking loans and failing to repay

them.

2.2.4 Transparency and Accountability

According to Anyango (2006) it was clearly seen that transparency and accountability in

group financial operations are considered one of the key factors that enhance group

performance in the VSLA model. All members of the group has a right to information,

this is because all the business of the group are done during the group meeting which is

normally takes place once in a week.

2.2.5 Action Audit

The VSLA methodology is designed to have a definite termination period called the

action audit which is usually one year, the group begin each cycle and work towards

accumulating savings and other earnings to be shared out during the action audit. The

action audit is meant to provide accountability at all levels. The leaders are held

accountable for their actions during the terminating cycle and are subject to scrutiny

before being re-elected or dropped. The financial records are audited for the entire period

8

and cash is reconciled with the books. Members are also held accountable for their loan

obligations. In the action audit (share out) the money available is shared out amongst the

members in proportion to the amount that they have saved. If any member has not repaid

his/her loan by the time of the action audit, the shares equal in value to his/her debt are

cancelled in his/her passbook. In this way the defaulting member is penalized, because

the cancellation of the shares means that he/she will not receive the profit on those shares,

but only on the number of shares remaining. According to study by Allen and Staehle,

(2006) it was found that the action audit is one of the most significant contributors to

accountability and cohesion in the groups. All 25 groups in the sample had conducted an

action audit at least once; 18 out of 25 (72%) had conducted one within the last 12

months and the other seven within the last 24 months. All groups and individuals

interviewed said that the action audit held the groups together. Leaders can be changed

during the action audit if their performance is not satisfactory and many groups had done

this. They also felt that it protected them from delinquency and losses because all loans

must be paid during the action audit. Failure to clear a loan leads to automatic deductions

from the shares of defaulting members to cover the loan. They said that the action audit

also gave members who want to exit the group an easy way out. Undesirable members

could also be asked to leave the groups during the action audit. In one extreme case (Ari

Mpya) where the members were dissatisfied with the leaders, the group dissolved and re-

formed without the former officials. The action audit is therefore a powerful tool for

enforcing discipline within groups.

9

2.2.6 Shared Responsibilities

The model proposes the use of shared responsibilities as a means of ensuring

transparency in group activities. The leaders’ roles are defined in such a way that they

control each other. The chairman has no direct role in handling cash. He or she presides

over the meetings and even discusses the money. The secretary records the transactions

and the treasurer verifies the records with cash. The records are open to members for

scrutiny. This ensures the segregation of duties as well as checks on the leaders.

An additional control is the trainer’s expected audit of the cashbook every month during

the closing of the books. Collection of funds during a meeting should involve each

member walking up with their money (whether it is for shares, loan repayment, penalties

or other savings), displaying it to the members to confirm the total and placing it in the

appropriate bowl where it is confirmed by money counters. The passbook is then stamped

for the purpose of accountability.

The safety of the cash box is also ensured by the segregation of duties. There should be at

least four people involved in handling the cash box: three members who are not group

officials holding different keys to the box and the fourth keeping the box, which is only

opened in the presence of the group members. All financial records and cash are kept in

the box to avoid manipulation by officials, Anyango (2006)

2.2.7 Profitability

According to Anyango (2002) in the study of VSLA groups in Zanziber reported that

VSLA have performed well in terms of profitability. During the last pay out for all 25

10

groups the mean rate of return was 53% with individual rates ranging from 10% to 92%.

The mean pay out was Tshs 5,000,000 per group and Tshs 173,535 per member. 72% of

the groups had paid out dividends during the 12 months. This evidence suggest that the

majority of groups are conducting an action audit annually and paying members with

dividends

2.3 Economic empowerment

Over the last decade, researchers and practitioners from different fields have contributed

to deepening the understanding of empowerment. Kabeer N (1994), Pigg, Kenneth

(2002). Empowerment is often viewed as both a means to a specific end and as an end in

itself Naraya, Deepa (1995). Empowerment involves the ability to make choices and

entails a process of all components of societal structures that shape and reproduce power

relations and the subsequent unequal distribution of society’s resources and opportunities.

Empowerment has two dimensions, resource and agency. Resources cover both tangible

and intangible assets. Tangible resources include material and financial while intangible

resources includes skills, knowledge , and expertise as well as membership and

participation in organized social and or political networks Agency on the other hand

refers to the ability of people to define their goals and objectives and to act upon them.

Because of the significance of beliefs and values in legitimating inequalities and resulting

institutional biases, agency in the context of empowerment implies actions that challenge

power relations. It involves both changes from within (in how people see themselves or

their sense of self worth) and in peoples ability and capacity for action and enforcement

of claims Pigg, Kenneth E (2002) empowerment has been viewed in different angles

11

such as social, political and economic empowerment, this study mainly dealt with

economic empowerment of the VSLA aspect of empowerment. According to Ezra

Anyango (2006), Mutesasira and Mule (2003) while evaluating VSLA, measured

economic empowerment using the following parameters; access to credit, savings and

assets, income and consumption, food security, health, education and female

empowerment.

2.3.1 Access to credit

Credit is simply borrowed funds that one can use to purchase things they need when they

need them and then pay back at an agreed time. In this study credit will mean the loan

borrowed by VSLA members from the groups. The convectional view is that credit is the

most important service of an MFI can offer, because it provides the means by which the

poor can invest their way out of poverty. This view is increasingly being challenged by

practitioners who observe that many poor people prefer to build their assets through

savings, rather than increase their risk exposure by taking out loans.

2.3.2 Income and consumption

Mutesasira and Mule (2003) in their study of VSLA in West Nile Uganda concluded that

most VGSLA were comprised of low income people. The average savings per member

and the average loan size provided some evidence of depth of outreach. The loans ranged

from Uganda shillings 500 to Uganda shillings 50,000 and savings per member ranged

from Uganda shillings 200 to Uganda shillings 1,000 weekly. The project reached very

low income households.

12

Allen and Hobane (2004) reached similar conclusion that VSLA have contributed to

increased household productivity and non productivity asset levels among the majority of

Kupfuma Ishungu (KI) members in Zimbabwe and some improvement in the quality of

housings. The study also noted that the number of income generating activities (IGA) per

household increased and IA became stable, while household labor allocated to IGAS

increased. 81% of the respondents felt that their status in the community had improved as

a result of their association with the VSLA. While these results are possible, it’s difficult

to attribute them to the intervention of VSLA alone. First Allen and Hobane (2004) had

no control or comparison group as a result there is no basis for attributing changes noted

to the intervention of the program. Secondly using recall data for a period of four years

may not yield accurate information as people tend to forget what their status was four

years ago. Thirdly the study had no any testing of the significance of the changes noted.

Together with other environmental factors such as hyperinflation, it is difficult to use the

results of these studies as conclusive evidence of economic empowerment.

2.3.3 Savings

According the study carried out by Ezra Anyango and others (2006) on VSLA in

Zanzibar, the quantitative data indicated that on average current VSLA users save Tsh.8,

972 per month, with no significant difference between men and women. The qualitative

studies showed that the overwhelming majority were happy with the value of the share

price of Tsh.500–1,000 a week (and they could contribute up to a maximum of Tsh.3,

000). However, there is a problem with members wanting larger loans and the difficulty

this poses due to the small volume of their savings. This indicates that there has been no

13

significant change in the share amount since CARE left, which raises the question of

whether the model has kept pace with inflation. From the financial records, the findings

showed that over the nine months to end of June 2006 total cumulative shares were

Tsh.63.7mn and total cumulative loans were Tsh.115mn, with a savings to loans ratio of

182%.

Uses of saving payout

According to a study of VSLA in Zanzibar Era Anyango and others (2006) found out the

following as the main use of savings pay out, for women were housing projects or

improvement (24%), the purchase of household assets (21%) and the payment of debts

(16%). Men mostly used them for housing projects and improvement (46%), the purchase

of household assets (15%) and productive investment (12%). However, a significant

number of women used savings for family celebrations (12%). The aggregated data

shows that a significant proportion (49%) mentioned food and household expenses as one

of the three main uses of their savings payouts. Other significant uses were housing

project/improvement (48%) and productive investment (29%).

2.4 Performance of VSLA and economic empowerment of the members

The relation according to available literature includes the following; well managed

groups have led to improved standards of living of the members, the program enables

members save for various reasons and in small and affordable amounts. Members can

easily access loans with providing costly collateral. Members have benefited from the

savings services offered by the VSLAs and the majority, especially women, have

14

generally been satisfied with the security of their money, the incentive to accumulate

money in affordable amounts and the opportunity to get lump-sum payouts with profits at

the end of the cycle for consumption and/or investment. Members have also benefited

from the loans, which have mostly been used for business and household expenses. An

unusual but significant loan usage was the payment of debts, which was explained as

borrowing from friends within the groups. Some members who did not require loans

immediately borrowed for their colleagues and such colleagues would then borrow to

repay that loan Era Anyango (2006).

2.5 Conclusion

In all the available literature, the studies found out that the intervention of VSLA has

greatly improved the live of the members; however, this is not the case in Akadot parish.

It is against this background that the researcher would like to carry out a research on the

performance of VSLA and the economic empowerment of the members particularly in

Akadot parish.

15

CHAPTER THREE

METHODOLOGY

3.1 Introduction

This section of the research describes the methodology that was used in the study. It

presents the research design, survey population, sampling design and methods, sample

size, sources of data, data collection methods and data analysis.

3.2 Research strategy and design

The research was evaluative in nature applying qualitative and quantitative methods of

collecting data and analyzing the data. Both the methods were used to identify, describe,

analyze and interpret the existing and gather information on the performance of village

group saving and loan associations and economic empowerment of the users. They were

considered because of the information needed for instance peoples views are qualitative

and this were quantified in percentages

3.3 Study population and sample size

The survey population covered the village group savings and loan associations members

in Akadot parish.

16

3.4 Sampling design, methods and procedure

3.4.1 Sample design and method

The researcher used probability random sampling method to draw the VSLA members to

constitute elements in the study in order to infer a wider generalization.

3.4.2 Sampling procedure

Using simple random sampling method a sample of 60 respondents were elected from a

population of 720

3.5 Sources of data

Data was obtained from both primary and secondary sources. Primary data included raw

facts which were collected from the field by the researcher and secondary data obtained

by reviewing written literature and records

3.6 Methods of data collection

Data was collected from the field using different data collections tools such as

questionnaires, interviews, and participant observations.

3.6.1 Self administered questionnaires

The self administered questionnaires were constructed to aid data collection. They were

distributed to various respondents by the researcher and were collected for data entry and

analysis.

17

3.6.2 Semi-structured interview

This was done by developing an outline in order to maintain the direction of the

interview; such a guideline indicated major issues to be covered in the interview and will

be referred to frequently during the process of the interview. This will allow the

researcher to put forward the views in a particular issue by listening and maintaining

focus and direction to prevent the conversation from going off track.

3.6.2 Participant observation

This is the careful observation and systematic watching of facts as they occur in course of

nature like taking time to walk around in the community, observing activities and asking

questions at the opportune moment. The researcher used this tool as the best way of

studying tangible economic variables.

3.7 Data processing, analysis and presentation.

3.7.1 Data processing

After data collection, data was statistically coded, entered, and analyzed using SPSS

3.7.2 Data analysis

After entering, coding and cleaning, data was analyzed using scientific packages for

social scientists (SPSS) which allowed the researcher to come up with relationship in the

study using Pearson correlation.

18

3.7.3 Data presentation

After processing and analyzing data, data was presented using tables which was the

interpretation of the analysis of the research.

3.8 Limitations of the study

The following were the research limitations;

Challenges were faced during data collection where some respondents were not

corporative, the researcher tried to be as friendly as possible and obtained information

from the respondents.

Another challenge during data collection was infrastructure in form of transport. The

researcher used local means available and accessed the respondents since the research

was carried out in the village

Research being expensive, the researcher was limited with funds. However funds were

solicited from friends and relations and the researcher used personal savings which

solved this problem

19

CHAPTER FOUR

PRESENTATION, ANALYSIS AND DISCUSSION OF RESEARCH FINDINGS

4.1 Introduction

This chapter deals with the presentation and interpretation of the findings of the study

which were done on the basis of specific objectives of the study and in relation to the

reviewed literature. The findings are presented with the help of tables for purposes of

easier understanding, clarity and interpretation. The response to the study consisted of 60

VSLA members

4.2 findings on demographic information of the respondents

4.2.1 Findings on gender of the respondents

Table 4.2.1 showing gender of the respondents

gender Frequency Percent Cumulative Percent

male 17 28.3 28.3

female 43 71.7 100.0

Total 60 100.0

Source: primary data

From table 4.2.1 above, 72% of the respondents are female. This indicates that most

members of the VSLA are female thus confirming to the basic principle of VSLA model

which advocates for woman empowerment (CARE International). As noted by Anyango

in a study of VSLA in Zanzibar, women prefer the program’s policies and men show a

higher level of exit and a greater desire for larger loans. The qualitative studies also

indicated that one of the factors accounting for the high proportion of women is the

positive effect of other aspects of the program, such as group support and the fostering of

social cohesion. However, the program appeals to some men who are attracted by the

financial services.

20

4.2.2 Findings on age bracket of the respondents

Table 4.2.2 showing findings on age bracket of the respondents

Age bracket Frequency Percent Valid Percent

Cumulative

Percent

18-25 8 13.3 13.3 13.3

25-30 24 40.0 40.0 53.3

30-45 20 33.3 33.3 86.7

45-above 8 13.3 13.3 100.0

Total 60 100.0 100.0


The research indicated that different age groups participate in the VSLA program as

indicated in the table 4.2.2 above. However, the majority 73% of respondents were in the

age bracket of 25-45 years. This suggests that the model attracts people from the younger

and economically productive age group.

4.2.3 Findings on the marital status of the respondents

Table 4.2.3 showing findings on marital status of respondents

Marital status Frequency Percent Valid Percent

Cumulative

Percent

married 42 70.0 70.0 70.0

divorced 2 3.3 3.3 73.3

widowed 7 11.7 11.7 85.0

single 9 15.0 15.0 100.0

Total 60 100.0 100.0


Table 4.2.3 above shows that 70% of the respondents were married. This means that in

Akadot parish the majority of married couples are members of VSLA

21

4.2.4 Findings on the Education Background of the respondents

Table 4.2.4 showing findings on Education of respondents

Level of education Frequency Percent

Valid

Percent

Cumulative

Percent

primary 26 43.3 48.1 48.1

secondary 18 30.0 33.3 81.5

certificate 5 8.3 9.3 90.7

diploma 4 6.7 7.4 98.1

degree 1 1.7 1.9 100.0

Total 54 90.0 100.0

Missing System 6 10.0

Total 60 100.0


From table 4.2.4 above, 73% of the respondents attained at least primary or secondary

education. This shows that most of the members of VSLA are less educated and the elite

class has not appreciated the model in Akadot parish.

4.2.5 Findings on Occupation of the respondents

Table 4.2.5 showing finding on occupation of respondents

Occupation Frequency Percent Valid Percent

Cumulative

Percent

farmer 42 70.0 79.2 79.2

teacher 5 8.3 9.4 88.7

student 6 10.0 11.3 100.0

Missing System 7 11.7 100.0

Total 60 100.0


The research indicated that 70% of the respondents are farmers as seen from table 4.2.5;

this means that most people who involve in the VSLA in Akadot are low income earners.

22

4.2.6 Findings on Average Income of the respondents

Table 4.2.6 showing finding on income level of respondents

Income bracket Frequency Percent Valid Percent

Cumulative

Percent

0-50000 30 50.0 50.0 50.0

50000-100000 22 36.7 36.7 86.7

100000-200000 3 5.0 5.0 91.7

200000-above 4 6.7 6.7 98.3

5.00 1 1.7 1.7 100.0

Total 60 100.0 100.0


From table 4.2.6 above, 87% of the respondents have an average monthly income of

between 0-100.000 shillings. This is because most of the members involve in small scale

farming as there occupation which in most cases are consumed at home or less is sold

4.2.7 Findings on VSLA membership

Table 4.2.7 showing finding on VSLA membership of respondents

Response Frequency Percent Valid Percent Cumulative Percent

yes 59 98.3 98.3 98.3

no 1 1.7 1.7 100.0

Total 60 100.0 100.0


From the table 4.2.7 above, 98% of the respondents were members of VSLA. This

indicated that majority of people in Akadot parish are members of VSLA

4.2.8 Findings on whether one holds leadership position in VSLA

Table 4.2.8 showing finding if a member held leadership position

Response Frequency Percent Valid Percent

Cumulative

Percent

yes 13 21.7 22.0 22.0

no 46 76.7 78.0 100.0

Missing System 1 1.7 100.0

Total 60 100.0


23

From table 4.2.8 above only 23% of the respondents held a leadership position in VSLA.

Since in a group of 30 members, only 5 members form committee members, therefore the

finding is consistent with this principle of VSLA model.

4.2.9 Findings on leadership type

Table 4.2.9 showing finding on leadership type

Leadership

position Frequency Percent Valid Percent

Cumulative

Percent

chairperson 5 8.3 35.7 35.7

secretary 5 8.3 35.7 71.4

treasurer 4 6.7 28.6 100.0


Total 60 100.0


The number of respondents holding the position of chairperson and secretary were same

represented by 36%, table 4.2.9 above.

Findings on the performance of village savings and loans association

Objective number one of the research was to evaluate the performance of village savings

and loan associations in Akadot parish.

4.3.1 There is a high volume of savings and loans in VSLA

Table 4.3.1 showing whether there were high level of savings and loans


Cumulative

Percent

Strongly agree 4 6.7 6.7 6.7

agree 53 88.3 88.3 95.0

Not sure 3 5.0 5.0 100.0

Total 60 100.0 100.0


From table 4.3.1 above, 95% of respondents agreed that there are high levels of savings

and loans in VSLA. From a case study of Temo Kinyeko B one of the VSLA groups, the

24

total savings of 2009/2010 was 7,256,000 and another group Kethi Wadongi A had a total

savings of 6,497,000 shillings and on individual level one VSLA member Pet Irota had a

total savings of 319,900 shillings and another Opero James hat a total savings of 291,300

shillings. Basing on Village settings, this indicates a significant volume of savings.

4.3.2 There are loan arrears in the group at the end of each cycle

Table 4.3.2 showing finding on whether loan arrears existed


Cumulative

Percent

agree 57 95.0 95.0 95.0

Not sure 3 5.0 5.0 100.0

Total 60 100.0 100.0


Table 4.3.2 above shows that 95% of the respondents agreed that loan arrears existed in

the group. This shows that there was loan arrears in most groups of VSLA, However

according to the interview held with the community based trainer Mr. Oleng Raphael

“members of the group always try o do their best to make sure that members with loan

arrears clear their debts in the next savings cycle’’ although in most groups sampled

members tried there best to see that those with arrears cleared their loan arrears, the

following groups still had loan arrears: Lwnnyi Gi Chandi 30,300 shillings, Tekere had

226,000 shillings and Akiba had 234,200 shillings.

25

4.3.3 Most members of the group default on their loans

Table 4.3.3 showing finding whether members defaulted on their loan



agree 25 41.7 41.7 45.0

Not sure 11 18.3 18.3 63.3

disagree 19 31.7 31.7 95.0

Strongly

disagree 3 5.0 5.0 100.0

Total 60 100.0 100.0


From table 4.3.3 above, 46% of the respondents agreed that loan defaults existed in the

groups however, this outweighed by the 55% who either disagreed or were not sure.

Because most group members try their best to make sure that members with arrears pay

explains the disagreement and also according to the interview with sampled group

leaders, the property of defaulters are in most cases are confiscated to cover the loan.

4.3.4 There is transparency in the group and accountability is done regularly

Table 4.3.4 showing findings whether transparency and accountability existed in

VSLA


Cumulative

Percent


agree 31 51.7 51.7 98.3

Not sure 1 1.7 1.7 100.0

Total 60 100.0 100.0


From table 4.3.4 above 99% of the respondents agreed that there is transparency and

accountability in the group. According to the interview, the books of are accounts are

freely accessible by all the members in the group, every business of the group is done

26

during group meetings and no one is denied information. According to CARE

International, VSLA methodology is designed to have a definite termination period and

the leaders are held accountable for their actions during the terminating cycle and subject

to scrutiny.

4.3.5 The group carries out action audit where members are paid back there savings

plus interest

Table 4.3.5 showing finding on whether VSLA groups carried out action audit

Response Frequency Percent

Valid

Percent Cumulative Percent


agree 22 36.7 36.7 98.3

disagree 1 1.7 1.7 100.0

Total 60 100.0 100.0


From table 4.3.5 above, all the respondents agreed that the groups carried out action

audit. This is so because this is the only venue that the model provides through which

members can get back their savings plus interest. According to a study of VSLA by

Anyango in Zanzibar, all the 25 groups sampled had conducted an action audit and that

all the groups and individuals interviewed said that the action audit held the groups

together.

4.3.6 Every leader in the group has a defined role which is different from others.

Table 4.3.6 showing finding on leadership roles in VSLA


Cumulative

Percent


agree 38 63.3 63.3 73.3

Not sure 15 25.0 25.0 98.3

disagree 1 1.7 1.7 100.0

Total 60 100.0 100.0


27

Table 4.3.6 above shows that 73% of the respondents agreed that in VSLA group, the

roles of the members are well defined and that the role does not conflict. According to the

interview carried by the researcher, the chairperson’s role is to preside over meetings and

discuss money, the secretary records transactions and the treasurer verifies the records

with cash. This agrees with Ezra Anyango’s findings in her study of VSLA in Zanzibar

2006.

4.3.7 Village savings and loans association are highly profitable

Table 4.3.7 showing finding on the profitability of VSLA


Cumulative

Percent


agree 48 80.0 80.0 95.0

Not sure 3 5.0 5.0 100.0

Total 60 100.0 100.0


From table 4.3.7 above, 95% of the respondents agreed that VSLA is highly profitable.

From the groups sampled, this correct for example Temo Kinyeko B had a total profit of

4,045,250 shillings during the 2009/2010 graduation report; this agrees with Anyango

(2002) report on profitability.

4.4 Findings on the economic empowerment of VSLA members.

The second objective was to examine the economic empowerment of VSLA members in

Akadot parish, the following were the findings.

28

4.4.1 Accessing funds/loans is easier with village savings and loans association

Table 4.4.1 showing finding on ease of accessing loans



agree 46 76.7 76.7 100.0

Total 60 100.0 100.0


When respondents were asked whether is easier to access loans with VSLAs, all of them

agreed. This is supported by the answers that the researcher got from the interview where

respondents said that getting loan is mandatory and that every member of the group must

get loan.

4.4.2 joining the saving group has contributed to the increase in the level of my

income and consumption.

Table 4.4.2 showing finding if joining VSLA improved member’s income and

consumption

Response

Frequen

cy Percent Valid Percent

Cumulative

Percent


agree 54 90.0 90.0 100.0

Total 60 100.0 100.0


All respondents agreed that joining VSLA improve the level of their income (table 4.4.2).

This result closely agrees with the findings of Allen and Hobne (2004) in their study of

VSLA in Kupfuma Ishungu Zimbabwe where the IGA of households had increased and

81% of the respondents felt that their status in the community had improved as result of

their association with the VSLA.

29

4.4.3 VSLA has enabled me to improve on my savings culture

Table 4.4.3 showing finding on if joining VSLA improved members’ saving culture


Valid

Percent

Cumulative

Percent


agree 53 88.3 88.3 100.0

Total 60 100.0 100.0


Table 4.4.3 above shows that all the respondents agreed that VSLA improved their

savings culture. the researcher had an interview with Mrs Scovia Olwalo who is a

member of Lwenyi Gi Chandi VSLA and she made the following remarks, “I used not to

know anything about savings and I used not to save any money at all, all the money that I

could get I could spend but when I joined VSLA, I was trained about savings and its

benefits, now I save weekly however little but I make sure that I save some thing every

week”.

4.4.4 I use my savings pay out in the best way possible

Table 4.4.4 showing finding on whether VSLA members used their saving payout in

the best way


Valid

Percent

Cumulative

Percent


agree 46 76.7 76.7 88.3

Not sure 7 11.7 11.7 100.0

Total 60 100.0 100.0


All the respondents agreed that they put their savings pay out into best use. According to

the interview one respondent had this to say, “The payouts have played a very important

role in my life. They come at a very opportune time, during our Christmas celebrations.

30

Through the payouts, I was able to purchase food for the family, bought some household

items and I bought a hen without this group, I would never be where I am now.”

4.4.5 VSLA has enabled me to pay school fee

Table 4.4.5 showing finding on if funds from VSLA were used to pay school fess

Frequency Percent

Valid

Percent

Cumulative

Percent


agree 18 30.0 30.0 38.3

Not sure 30 50.0 50.0 88.3

disagree 7 11.7 11.7 100.0

Total 60 100.0 100.0


Majority of the respondents were either not sure of the question or disagreed (table 4.4.5)

above. This may be because of UPE and USE where parents no longer pay school fees.

4.5 Findings on the performance of VSLA and economic empowerment of the

members

4.5.1 Funds / loans accessed from VSLA has helped to improve my economic status

Table 4.5.1 showing finding on whether VSLA had improved members economic

status


Cumulative

Percent


agree 50 83.3 84.7 98.3

Not sue 1 1.7 1.7 100.0


Total 60 100.0


Table 4.5.1 above shows that 98% of the respondents agreed that VSLA improved their

economic status. This confirms with the findings above

31

4.5.2 It is better to join VSLA than not being a member.

Table 4.5.2 showing finding on whether it was better to join VSLA


Strongly

agree 8 13.3 13.6 13.6

agree 47 78.3 79.7 93.2

Not sure 4 6.7 6.8 100.0

Missing

System 1 1.7

Total 60 100.0


From table 4.5.2 above 91% of the respondents agreed that it is better to join VSLA other

than not being a member. This means that those who are members benefits from the

model and thus would recommend the model to another party

4.6 The relationship between performance of VSLA and economic empowerment of

members

Table 4.6 showing correlation of the topic variables

PERFORMANCE

OF VSLA

ECONOMIC

EMPOWERMENT

OF MEMBERS

PERFORMANCE OF

VSLA

Pearson

Correlation 1 .415(**)

Sig. (2-tailed) . .001

N 60 60

ECONOMIC

EMPOWERMENT OF

MEMBERS

Pearson

Correlation .415(**) 1

Sig. (2-tailed) .001 .

N 60 60

** Correlation is significant at the 0.01 level (2-tailed).

From the table above, it is evident that there is a positive relationship between the

performance of VSLA and economic empowerment of members indicated by Pearson’s

32

coefficient r=0.415. This means that for as long as the groups perform well, the members

will be economically empowered

33

CHAPTER FIVE

SUMMARY, CONCLUSION AND RECOMMENDATIONS OF STUDY

5.1 Introduction

This chapter presents the summary, conclusions and recommendations of the study. This

was done in relation to the objectives of the study.

5.2 Summary of findings

Findings were summarized in relation to the objectives of the study

5.2.1 Summary on performance of VSLA

Findings of the groups revealed that the groups had large volumes of savings, high level

of transparency and accountability, groups carried out action audits and VSLA were

found to be highly profitable. These are all indicators of good performance of VSLA

groups in Akadot parish.

5.2.2 Summary on economic empowerment of members

Findings reveal that the economic status of VSLA members of Akadot parish had been

improved. This is evidenced by the fact that most members are able to access credit

which is essential in creating capital for starting income generating activities. Also

members are empowered through being able to save and earn interest on their savings.

5.2.3 Summary on performance of VSLA and economic empowerment of members

Findings revealed that there was a significant relationship between performance of VSLA

and economic empowerment of members. According to the study it was found out that

performance and economic empowerment have a strong correlation as shown by

Pearson’s coefficient of rank indicated by r=0.01.

34

5.3 Conclusions

5.3.1 To evaluate the performance of VSLA in Akadot parish

From the study findings, it is clear that VSLAs in Akadot parish are performed well. The

groups are characterized with high profitability levels, groups had no loan arrears, no

defaults on loans, there was transparency among group members and all the groups

carried out action audit and paid their members.

5.3.2 To examine the extent of economic empowerment of VSLA members in

Akadot parish.

Findings reveal that Members have benefited from the savings services offered by the

VSLAs and the majority, especially women, have generally been satisfied with the

security of their money, the incentive to accumulate money in affordable amounts and the

opportunity to get lump-sum payouts with profits at the end of the cycle for consumption

and/or investment. Members have also benefited from the loans, which have mostly been

used for business and household expenses which loans can be easily accessed at any time

one requires them.

5.3.3 To establish the relationship between performance of VSLA and economic

empowerment of members.

Findings revealed that there is a significant correlation between performance and

economic empowerment indicated by r=0.415(**), implying that performance is part of

economic empowerment.

5.4 Recommendations

Basing on the findings the following are the recommendations;

35

1. VSLA groups need to be sensitized to stick to their methodology of operation given

the fact that it is the motherboard of all operations. They should also abide by their

rules and regulation

2. Business training skills training should be extended to the group members to ensure

that income generating activities are promoted at individual households.

5.5 Areas for further research

1. Sustainability of VSLA and the livelihood of the members

2. poverty outreach and socio-economic profile of VSLA users

3. Achievements and Challenges Facing VSLA

36

References

1. Allen, H. (2002). CARE International's VS&L Program in Africa: Microfinance

for the Rural Poor that Works.

2. Allen, H. and P. Hobane (2004). Impact Evaluation of Kupfuma Ishungu

Zimbabwe.

3. Allen, H. and M. Staehle (2006). Village Savings and Loan Associations.

Program Guide. Field Operations Manual Version 2.0.

4. Anyango, E. (2005). CARE Malawi Central Region Livelihood Security Project

Impact Assessment Report on Village Savings & Loans Component (VS&L).

5. Doka, M. D. and A. Mossige (2001). CARE International Niger Project Proposal

prepared for NORAD.

6. Grant, W., J and H. Allen (2002). "CARE's Mata Masu Dubara (MMd) program

in Niger: Successful financial intermediation in the rural Sahel." Journal of

Microfinance 4(2): 189-216.

7. Hartley, D. and H. Rijali (2003). Final project review Jozani-Chwaka Bay

Conservation Project (KCBCA) phase III Zanzibar Tanzania.

8. Johnson, S., M. Malkamäki, et al. (2006). "Tackling the 'frontiers' of microfinance

in Kenya: The role for decentralized services." Small Enterprise Development

17(3): 41-53.

9. Mutesasira, L. K. and N. R. Mule (2003). Understanding the West Nile SLAs and

Charting a Path for the Future.

37

10. Allen H (2006) Village savings and loan Associations, sustainable and cost

effective rule finance; small enterprises development 17(1) 60-68

11. Kabeer N (1994) reversed realities: Gender hierrchiesin development thought new

York

12. Pigg (2002) three faces of empowerment: expanding the theory of empowerment

in community development, journal of the community development society vol 33,

issues1, 2002 pg 107

38

Appendices

Appendix 1

Case study pictures

Above and below: Amor Echan VSLA members attending their savings meeting. A group

has 30 members, of which 5 are committee members.


39

Members of Temigijo VSLA doing business, below are the

source: primary data

40

Below is a tool box kit where all property of a group are kept including savings

Box safly closed above and below when open


41

Below is a picture of a VSLA pass book where details of a member are recorded

source: primary data

42

Appendix 2

QUESTIONNAIRE

INTRODUCTION

Dear respondent,

I am a student of Makerere University pursuing a degree of bachelor of commerce and I am

carrying out an academic research study on performance of village group saving and loans

association and economic empowerment of the members. I kindly seek your opinion and

answers to the questions raised in this questionnaire to facilitate my study by either ticking the

appropriate option or by giving a brief explanation as required, the information obtained shall be

used for purely academic purposes only and your opinion will be treated with utmost

confidentiality.

SECTION A: DEMOGRAPHIC DATA

What is your name (optional)……………………………………………………………………

Gender (please tick one) Male Female

Age bracket (please tick one)

Below 18 18-25 25-30 30-45 45-Above

Marital status (please tick one)

Married Separated/divorced Widowed Single

Education Background (please tick one)

Primary Secondary Certificate Diploma degree

Occupation

Farmer Teacher doctor others (specify)……………….

Average monthly income

0-50,000 50,000-100,000 100,000-200,000 200,000-above

43

SECTION B: VSLA MEMBERSHIP INFORMATION

Are you a member of any Village Savings and Loan Association?

Ye No

If no, why?.........................................................................

If yes, do you hold any leadership position in the group?

Yes No

If yes, what position do you hold?

Chairperson Secretary Treasurer others (specify)………………

SECTION C: PERFORMANCE OF VSLA

STATEMENT Strongly

agree

Agree Not sure Disagree Strongly

disagree

There is a high volume of savings and

loan in this group

There are loan arrears in the group at

the end of each cycle

Most members of the group do not pay

back (default) there loans

There is transparency in the group and

accountability is done regularly

The group carries out action audit

where members are paid back there

savings plus interest

Every leader in the group has a

defined role which is different from

others

Village group savings and loans

associations are highly profitable

44

SECTION D: ECONOMIC EMPOWERMENT OF VSLA MEMBERS

Statement Strongly

Agree

Agree Not Sure Disagree Strongly

Disagree

Accessing funds/loans is easier with

village saving and loans associations

Joining the saving group has

contributed to the increase in the level

of my income and consumption

Village saving and loans association

has enabled me to improve on my

saving culture.

I use my saving pay out in the best

way possible

Village savings and loans association

has enabled me to pay my children’s

fees

SECTION E: PERFORMANCE OF VSLA AND ECONOMIC EMPOWERMENT OF

MEMBRS

statement Strongly

agree

agree Not

sure

disagree Strongly

disagree

Funds/loans accessed from village

savings and loans associations has

helped improve my economic status

It is better to join village savings and

loans association than not being a

member

45

Appendix 3

INTERVIEW GUIDE

CLIENTS OF VSLA ONLY

1 What is your name?

……………………………………………………………………

2 What is your occupation?

…………………………………………………………

3 Are you married?

…………………………………………………………

4 Are you a member of any Village Savings and Loans Association?

…………………………………………………………

5 When did you join the VSLA?

……………………………………………………

6 How much do save per week?

………………………………………………………………

7 How many times have you received savings payout?

……………………………………………………………………

8 How much did you receive from the last payout?

……………………………………………………………………

9 How did you spend your savings payout?

…………………………………………………………………………………

10 Have you borrowed any loan from the VSLA?

………………………………………………………………………………

46

11 How much did you last borrowed?

………………………………………………………………………………

12 How did you spend the loan borrowed?

…………………………………………………………………………

13 Do you have problems paying your loans?

…………………………………………………………………………………

14 What problems do face in paying your loans?

………………………………………………………………………

15 How have the VSLA program changed your life ever since you joined?

……………………………………………………………………………

THANK YOU VERY MUCH

CONTROL QUESTIONS

4Why have you not joined any VSLA?

……………………………………………………………

10 Why have you not borrowed any loan?

……………………………………………………………

7 Why have you never received any savings payout?

…………………………………………………………

performance of village saving and loan associations …

Documents