Microfinance in Jinja

We started the day bright and early! We made it to MUBS on Ugandan time at about 7:30 or approximately 45 minutes behind schedule. Once we finally made it to MUBS we ate our last breakfast at the canteen. When we were done eating we left for Jinja with the MUBS students.

Once we were on the bus we heard some basic information about our bus ride toJinja. Fred told us that Jinja is the second largest city in Uganda. He also told us that we would be passing the Owen Falls Dam. After we crossed the bridge over the source of the Nile, we would be entering into the Busoga kingdom. We had previously been in the Baganda kingdom. On the way to Jinja we also passed the Mabira natural forest, sugar cane plantations, and tea plantations.

Local people greeted us with music for the microfinance lesson. After we were greeted they started the presentation with prayer and the Uganda national anthem. We made introductions and got a very basic overview of the microfinance situation in the rural village. After that we took a musical interlude, which included traditional dancing and music. The music continued, but became educational when some singers came out. They sang about how grateful they are that people are able to form groups and the groups help them to save and link them. In the next song they referenced how they used to save money by keeping it in the house and hiding it in pots or roofs of houses, but now they know how to finance.

After the music, the Kugumikiriza V.S.L.A. group used a skit to teach us about how they were using micro financing in their village. The first skit basically showed how a mother hid money in pots, the roof, and in the dirt. The money in the pot and dirt were stolen and the house burned down leaving them without saved money. This skit showed how saving money used to be a problem in Uganda because people could easily steal it.

The second skit showed the new microfinance system that a rural village outside Kampala is using. It started with a girl listening to music on a radio and having her father take it away from her and listen to the news. He heard an ad about an organization that teaches people how to save. In the next scene people come to the seminar to receive training that will help them keep their money safe. The trainer asks how people have been saving and they say that they have been keeping their money hidden in pots and other places. The people had been treating their savings like leftovers. The instructor introduces them to new methodology called V.S.L.A. (Village savings and loan association). V.S.L.A. could allow them to save money and accumulate it.

In order to save money with the V.S.L.A. methodology the locals needed to be trained. They would need to go through 5 training phases. The first phase was group formation, which helped them to form their group. Each group would need to agree on a minimum amount to share. The next training phase was saving, loaning, interest, and social fund training. The last three phases that were taught were records, bylaws, and procedures. The skit then went into how it is easier for locals to pool their savings because it makes it easier to save and also easier to borrow.

The skit also addressed the fact that the savings meetings are gender sensitive. There needs to be at least 2 women out of the 5 minimum people who need to be there. This program is helping women to take control of their finances.

The next part of the skit had to do with what happened at a meeting. The members would ask the previous balance and count the money. There would be 3 key holdersthat couldn’t be related who would open the box. There were 4 different areas the money would be separated into including finance, welfare, savings, and repayment. Roll is called at the meetings and each person has a number to ensure they are present. At the end of the meeting all members witness the box being locked by the key holders and the treasurer takes the box home.

The skit also addressed the fact that some groups decide to make an emergency fund. They make a separate fund and have a different treasurer be in charge of that box. If someone would need to get into the emergency fund there would need to be 2 witnesses.

If someone wanted to borrow money all the members would equalize the loan. The loan would need to be paid back in 3 months time. The interest could be between 5-10%, but it's usually 10%. The person taking out the loan must pay interest back monthly. This program is a huge benefit to the community because it helps them set up loans and have savings.

Everything that has happened up until this point was in the local language and had to be translated into English for us. It was challenging at least for me to pay attention to the skit and also the translation. They did have a closing poem that was in English. It summarized the fact that before the V.S.L.A. methodology the situation was poor, but after V.S.L.A. people feel more empowered. It stressed that all of society was improved.

One of the most important impacts this program has made on the rural villages is that is teaches people how to save. It also allows women to run their own finances. The program teaches people how to be financially independent and helps bring people together. We don’t have the community feel that these people have because in the U.S. we just walk into a bank or ATM to get money. The people are able to form more of a community because they are saving their money together. After many thank yous in both English and the native language we left the village.

V.S.L.A. is definitively having a positive impact on sustainable development in rural areas. It is teaching people how to save their money. Italso allows people in these villages to have more access to a loan. It is important to give people access to loans because they are more willing to start a business, which in turn will create jobs and stimulate the economy. It also gets women involved in keeping their finances. To have a sustainable society Uganda needs more entrepreneurs and opportunities for men and women to start their own businesses. V.S.L.A. gives people the access they need to take advantage of these opportunities.

We went to the chairman president’s mom’s house after the microfinance presentation, where we had been invited to lunch. We were greeted with a few speakers. John talked to us a little about the world becoming smaller. He referenced John F. Kennedy and how Ugandans used to come to the U.S. and Americans came to Uganda through the Peace Corps. He talked about how both our countries share a common ancestry with Great Britain and how glad he was we came. We also heard about YPMA (Young professional managers association). After all the greetings we ate some traditional Ugandan food and fruit for dessert. All the food was very delicious!

We were able to enjoy an acrobat after we finished our meal. He did some tricks like riding his bike backwards and putting pants on while he was on his bike. He also made tea and drank it in less than 4 minutes while still on his bike. He also did some spinning wheel tricks. He was going to do tight rope walking, but the rope was too wet due to a brief afternoon thunderstorm.He did promise to send us a YouTube video to make up for it. Once the acrobat was done we thanked our hosts and left for the Kingfisher resort.

The Kingfisher resort is so beautiful. We made it just in time for the sunset. We have a great view of Lake Victoria. I know a few of us went down to the beach to admire the view and the sunset. It has been a great first day in Jinja!