To learn more about microfinancing, we went to visit Reach
Out Mubya (ROM), an organization those battles with the angel of death, AIDs,
head on. One of the community support service programs ROM does is called the
Bread of Life, an initiative to introduce their clients to microfinance. Through
this, ROM connects the people in need with Village Savings and Loans
Association (VSLR), in which a group a formed in order to start a saving and loan
system. ROM hope by having their clients work with VSLA, they will be able to
save money and develop their businesses, raising their self-esteem, and help
them feel in control of their life again after going through such an stressful
experience. Though, us Americans may not necessarily need to develop a new loan
and saving culture, I think it would be great for us to develop trust for each
other in our own communities. Uganda has a culture excels with this kind of
passion, with their values of the second commandant of generosity, and that I
probably one of the reasons why it has such a warm atmosphere here (and
probably because of the weather too :p).
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Trust is a key ingredient in financial markets everywhere. Much of US regulation is designed to instill confidence in the safety and soundness of the financial institutions. This is even more important in the microfinance community. What elements of the loan meetings surprised you the most? Do you think microfinance is making a difference in the lives of the recipients?
ReplyDeleteDr. Root - the most surprising element of the loan meetings for me was the deep interconnectedness and how well-planned everything was. It was so symbolic to have the three locks on each box, demonstrating that each member was necessary and all decisions were made collectively. It was incredible to see how the micro finance institutions are benefiting the recipients even just through their saving habits - I know in my group, almost everyone had fish stickers in every box of their packet!
ReplyDeleteI would agree with both of you. In my meeting there was one woman who was keeping all of the records in the books and the others relied on her to make sure that everything was done accurately. The loans that they were getting here went towards starting and improving their stores and other business ventures. These were sources of income that they didn't have up and running for more than a few years and yet it seemed like they were thriving. This just showed our whole group that by saving and working together you can change your lives and help others change theirs as well.
ReplyDeleteI agree that microfinance is making a significant difference in these peoples' lives. With loan rates at banks being as high as they are (up to 25%) loans are nearly unattainable outside of these groups. The group I visited was a group of all women, most of whom are prostitutes who ROM is working to rehabilitate. Our group was not told this until after our visit and I never would have guessed. The women seemed to have found a number of legitimate sources of income thanks to microfinance. This included a group run chicken coop that the group had built with the money they had saved via the loan group. Overall the women seemed very proud of their work and loan group, and had an excellent chicken coop business, partially thanks to ROM.
ReplyDeleteDefinitely! This system has is able to make a huge impact far beyond teaching people saving money but turning someone whole life around. This really emphasizes shows how vital our word incorporates the value of money into our daily lives and able able to make such an impact depending on whether we have it or not. In my group there was a few ladies who just got out of college was unable to get a job. Microfinance was able to allow her to start her own business and support her children in school. I am really grateful ROM is able to connect their clients with this amazing system!
DeleteLooking back on the entire trip I have found that our microfinance interaction with Reach Out was my favorite. It was very cool to see Ugandan's taking part in something that is taking matters into their own hands and is sustainable. Microfinance allows for the less fortunate to do what the government and banks do not and will not do for them. I found it to be very inspiring and admirable for those that are building better lives for themselves with their own aid. This type of thinking is what Uganda needs more of, microfinance is making a huge difference in the Ugandan's lives as they are able to achieve so much more with the loan ability, savings, and access to welfare.
ReplyDeleteFrom our experience in the field of microfinance it was very eye opening. We were able to see a group of people bring savings, equality and honesty together to support their lives. It was impressive how effective the group was and how everyone was accountable for their actions. The groups helped promote sustainability and gave members opportunities to expand their businesses. Microfinance can be very successful in poor economies such as we've seen in Uganda.
ReplyDelete