You can make life easy for a rural woman in Cameroon. We present a project below, do you wish to donate or sponsor it in any way, contact us at info@gmmafrica.org or at +237 75726548.
What is this: A women empowerment program combined with saving and lending model so as to enable members arrange for their children’s education. At the same time help them maintain a disciplined money saving habit and provide them with short term loan of up to 80 USD per month, from their own pooled saving.
This project will help women from 3 aspects of empowerment; Making them financially self sufficient; Helping them arrange for their children education and Improving their ability to take independent decisions.
Project in Brief: This project will begin in September 2011 when women have already admitted their children in the current academic session. And have exhausted all their savings in meeting the educational cost. Here the project begins with ZERO capital both at member as well as the group level. The Group will get 4 Months Oil and other costs as grant. Group will distribute Oil to the members Free on the first month and at 50% discount for 2nd and 3rd and 25% discount for 4th and 5th month and at Cost Price for subsequent months.
Women will sell Oil and will meet again next month to pool their savings. As this project is aimed towards providing fund for education, Women are encouraged to save more and avoid any indiscriminate use of the money. After all the members have pooled the money in what we call SAVING AND LENDING KITTY, members can express their will to borrow the money at stipulated terms and conditions. In this way pooling of small saving of each member will make it usable as a credit for 1 or more members, as month’s advances and the pool grows, more and more number of members can borrow from it. On the 2nd month first repayment of loan will be done and this amount will be summed up with the contribution of that month and will be loaned to a new member
At the beginning of 13th month i.e on 1st week of September 2012 women will have an accumulated saving and lending kitty of 1212 USD, and a surplus of 250 USD at SHG level. Together it will make an amount of 1462 USD which will be redistributed to the members which they can use to finance their children education for an year. Redistribution of S&L kitty will be in accordance to the contribution made whereas surplus at SHG level will be equally distributed.
In case women do not want to dissolve the group and want to carry on with the Project, only S&L kitty will be dissolved at the end of 12th month whereas surplus at Group level will be carry forwarded as retained earnings and will be used to buy Oil for the coming month.
Key Points: It is assumed that there are 120 Children benefiting from the project (30 Children in each group). Tuition Fees, Book and other supplies etc will cost 40 USD per child per year. Thus total capital to be collected by each group for 30 Children by end of 1 year is 1200 USD.
Uniqueness and Strengths:
- The Project reaches self sufficiency within the 4th month of operation; don’t need instilling of any capital after this month.
- Capital remains within the Group: interest paid on loan remains within the group and builds the cash assets of the members.
- Transparent, Democratic and flexible: Members determine their own rules and decisions are made through consensus.
- Opportunity for increased Economic activity: If the group decides they can link to formal financial system to seek access to more formal and wider array of financial services.
- Build Institutional Linkages: The group can leverage their social capital and organisational capacity to link into agricultural development efforts, health and education.
- No freebies: Women will not get resources free of Cost, this is to encourage them to avoid any indiscriminate use of resources.
What is Saving and Lending Kitty- Saving and Lending Kitty is the saving contribution pooled by the members in the beginning of month and the amount thus collected is loaned to the members. The Accumulated sum from 2nd month onward will include saving contribution and the Earning from loan repayment, which is again available for lending to other members. Objective
- To build a capital base of 1200 USD at the end of the Project so as to cover the Children Education cost before school reopens.
- Enabling women to have an access to hassle free short term credit each month to finance their other commitments.
- To provide them a steady flow of money each month so that they can take care of small educational requirement of the kids during the month.
- To provide a self sustainable Model for their business that will attain financial independence at the fifth month.
- To help women develop a disciplined saving and investing habit and help them understand the power of systematic investment and mobilization of resources.
- To help women understand the optimum utilization of resources.
- To inculcate entrepreneurial and leadership skills.
How it works:
a) Selection of Women: Group of women whose primary goal is to arrange for Tuition Fees and other educational requirements of their children before the beginning of new session. There will be 10 women in 1 group.
b) Selection of leader-
Group Leader- This leader will buy oil and will keep accounts related to Buying and selling of Oil to the members in the defined format.
Saving and Lending Kitty leader- This leader will keep a record of savings pooled by each member every month in the given format, will collect repayment from the borrower with interest and will close her account in books. At the end of the Project will redistribute the Accumulated Capital in the same proportion as it was pooled in by the members.
c) Monthly Meeting- Agenda of meetings
1st Month- Distribution of Oil to the members and handing over a communication about -Cost of Oil for the coming months, Asking to keep a Provision for next month’s buying, Expectations regarding Saving, Lending Norms and condition and other Code of conduct. Meeting closes.
2nd to 12th Month- Collecting the loan Repayment from the borrower (Principal + 2.5% Interest) hereby called “Earning from S&L Kitty” & Closing her account in books. Pooling of saving and keeping the records regarding each member’s contribution. Asking the nominations for borrowing of Accumulated sum (Contribution + Earning) and taking group’s consensus. Handing over the money to borrower. Buying the Oil at stipulated price and closing the meeting.
13th Month ie Sept 2012, the Accumulated Sum in S&L kitty is redistributed to the members; amount is redistributed in the same proportion as it is contributed. Whereas sum left at Group level will be equally distributed.
Conditions For loan:
- Loan term is 1 month but if the borrower is not able to repay loan it can be carry forwarded to a period not exceeding 3 months and interest will be charged accordingly at a flat rate of 2.5% every month.
- Loan is at 2.5% per month and repayment is Principal + 2.5% per month.
- Loan application for a Productive purpose is given priority.
- In case of default the women is declined the share in final settlement.
- At a time more than 1 member can take loan, 1 member can take loan for more than once unless she has repaid her previous loan. Maximum loan that a person can take at a time is 80 USD.
GMM’s Role:
- GMM will arrange expenses for first 4 month through grants and fundraising.
- GMM will facilitate election of leaders.
- GMM will help the Group leader in price negotiation with suppliers.
- GMM will organise training for leaders in book keeping will also provide the formats to keep separate records at each level.
- GMM’s officer will closely monitor the meetings for first 6 months so as to see that the records are kept properly and loan is disbursed in designated format.\
- GMM will monitor the final settlement and will ensure no disagreements happen.
Financial Snapshot: All Figures in USD for one Group
| 1 | Members Combined Capital in the beginning of project | 0 |
| 2 | Average saving per month | 85 |
| 3 | Amount available at S&L kitty at the End of project | 1212 |
| 4 | Amount available at Group level at the end of the project | 250 |
| 5 | Amount available for redistribution to members (3+4) | 1462 |
| 6 | Loan amount disbursed from S&L kitty during the Project | 7733 |
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