VSLA at 25

The global humanitarian aid and development industry has a problem: innovation is everywhere, but examples of successfully scaled solutions are far less common. Even when we achieve impact at scale, the process can take decades. For example, it took 17 years for CARE’s Village Savings and Loan Associations (VSLA) to go from idea to widespread impact, economically empowering millions. CARE’s Scale X Design (SXD) Accelerator was created to bridge that gap between innovation and impact. Two of the SXD teams’ innovations, Chomoka (Digital VSLA) and Journeys of Transformation, contain a VSLA component. Here is a story about VSLA at 25 that appeared in CARE’s latest edition of Impact Magazine.

MMD cash boxes hold the contributed savings for the community in Genki, Niger.

CARE Village Savings & Loan Associations: A Transformative Innovation Then — and Now by Shawn Reeves

For 25 years, CARE Village Savings and Loan Associations have powered change through innovative economics. It all started with a few women, a lot of ingenuity and a lockbox in remote Niger. They engineered their own financial independence by saving pennies a week, then loaning one another money to start businesses such as making and selling peanut oil, doughnuts or home remedies. The interest they paid on their loans came back to them as profit. They had become their own bankers.

A quarter-century later, some 15,000 CARE savings groups operate in all reaches of Niger, their 500,000 members, mostly women, meeting regularly, depositing, saving, lending.

Some of that expansion happened strategically. Some of it happened organically, as people saw the success of CARE savings groups and wanted to share in that. The program may have started in Niger, but it didn’t end there. Further investment from CARE and word-of-mouth from passionate group members soon extended the concept to places like Mozambique, Tanzania and Zambia.

Today, more than 200,000 CARE VSLAs operate in 26 African countries and in parts of Asia and Latin America, having engaged more than 5 million people. Enterprising members have found through those groups the financial freedom to improve life for their families, whether through better health and more nutritious food, expanded access to education or even savings-based safety nets that help families withstand and overcome disaster.

CARE now looks to the next frontier for its VSLA initiative, aiming in the next 25 years to help VSLA members more closely guard their assets — chiefly by linking them to formal banks, where their accounts are safe and accessible through smart phones and money-transferring apps. CARE already has begun linking VSLA groups to formal banks in places like Tanzania, Kenya, Ghana and Uganda. And by fall 2016, CARE had announced plans to link a half-million more people to banks by 2020.

But the benefits of formal banking don’t end with added security. Access to banks yields more sophisticated financial services that groups inevitably need as their resources, skills and confidence grow. It means larger loans, which groups demand as they mature. One report shows that linking members to banks can double both their savings and their profit.

As the next generation of VSLA members reaches for and seizes its own financial independence, some of them will still meet regularly under shade trees in Africa’s most distant villages. Others will convene in urban centers. They’ll adapt the model to ever-changing contexts. And they’ll continue to use the power of saving and lending to transform their lives and communities.

WSJ Video: Big Data: The Link Between Information and Financial Inclusion

Watch this video from the Wall Street Journal developed by CGAP, the World Bank’s financial inclusion unit which provides a short summary of the link between the growth in data generated by mobile phones and financial inclusion. It was shared with us by our Chomoka (Digital VSLA) team. The video raises the benefits and risks associated with this trend.

As the leading promoter of savings groups in Africa, CARE has established and willing users, more brand recognition and more understanding of the barriers these groups face than anyone else. We believe have a better shot than anyone else at getting a large number of people to use the solution, which is key to success. By being the provider of the solution that generates data on group trends and behavior, we also effectively can serve as a layer between that information and the growing range of financial service providers looking to bank groups and group members. By creating a marketplace- rather than tying our platform to a single financial service provider- we can promote competition and only market financial products to users that are designed with consumer protection and consumer prosperity in mind from the outset. We’re excited to see what happens in the future with digitizing savings groups!

Meet the Teams: Chomoka (Digital VSLA)

Over the past 25 years, CARE’s VSLA (Village Savings and Loans Association) model has revolutionized efforts to help low-income women improve their lives. Not only has CARE enabled 5,000,000 women and men to form and manage these life-changing groups, we have driven a global savings-led movement, engaging NGOs, banks, governments and donors in a journey that puts women and their savings first. Our efforts have resulted in over 12,000,000 members of VSLAs and groups like them as NGOs from global to local have replicated the CARE model. Members are routinely improving their lives through investments in education, health and entrepreneurship and women’s increased control over resources is leading to improved quality of life and opportunity for themselves and their families. VSLA has quite simply changed the game for poverty reduction. Through Chomoka (Digital VSLA), CARE is poised to do it again. This new initiative will empower low-income women to build a new generation of VSLAs that not only improve access to finance at the community level but also open doors to the digital economy that is rapidly transforming the world we live in and – until now – far too often leaving low income women further behind.

Chomoka is an emerging social enterprise driven by a proprietary mobile application used by VSLAs to manage their records, access banking services and gain advisory support from a trusted network of Chomoka agents. Once deployed at scale, Chomoka will accelerate and deepen formal financial inclusion while increasing usage of digital financial services in rural areas. The platform will generate an unprecedented, real-time data stream on the financial behavior of un- and under-banked groups and their members and offer new insights into the size, scope and behavior of these groups. Most importantly, Chomoka will enable groups to more effectively and accurately manage their transactions while also establishing digital financial histories and connections that open up a world of new possibilities. Chomoka expects to have over 1 million group members using the application by 2021.


Meet the Team

Mwimbe Fikirini | Program Coordinator | CARE Tanzania

Mwinbe Fikirini is the Program Coordinator with CARE Tanzania, and for the last several years has planned, lead, organized, directed and evaluated implementations of financial linkage activities to the VSLAs groups in areas of operation including Morogoro and Zanzibar. Mwinbe brings extensive knowledge of VSLAs to the team, having also trained and monitored the adoption of financial linkage and Financial Education skills by VSLA members. Going forward, Mwinbe will translate the proposal into a viable activity at the field level, including VSLA engagement in product design and testing, VSLA training on the developed solution and formulation of a realistic, field-level scaling strategy. For the past two years Mwinbe has been leading the LINK Up project in Tanzania, the largest effort by CARE to enable VSLAs to access formal finance. She holds a Master of Arts in Gender and International Development from the University of Warwick obtained in 2012 and a Bachelor of Laws from University of Reading obtained in 2009.

Christian Pennotti | Senior Technical Advisor | CARE Tanzania

Having worked across CARE for seven years, Christian has a strong institutional knowledge and relationship needed to move the project forward and find the right institutional fit. Christian is the overall LINK Up program manager responsible for program quality, design, M&E, partnerships and donor engagement. He is the chairman of the project steering committee and will serve as the lead in identifying and coordinating with project development partners and other external stakeholders including donors and prospective investors. Christian is a recognized leader in market development and is frequently invited to present at industry events. He sits on the Board of Directors of Farm Shop Ltd in Kenya and is the Chair of the Board of Directors at the SEEP Network. He holds a Master of Arts in International Development from George Washington University obtained in 2005 and was a Peace Corps volunteer in Uzbekistan where he founded a branch of the National English Teachers Association in collaboration with local officials.

Ken Banks | Entrepreneur in Residence | CARE International

Ken Banks, Founder of kiwanja.net and creator of messaging platform FrontlineSMS, devotes himself to the application of mobile technology for positive social and environmental change in the developing world. He has worked at the intersection of technology, anthropology, conservation and development for the past twenty-five years and, during that time, has lived and worked across the African continent. He is a PopTech Fellow, a Tech Awards Laureate, an Ashoka Fellow and a National Geographic Emerging Explorer, and has been internationally recognised for his technology-based work. In 2013 he was nominated for the TED Prize, and in 2015 was a Visiting Fellow at RMIT University in Melbourne, Australia. In late 2015 Ken was appointed CARE International’s first Entrepreneur in Residence. He is also a published author, with his first edited book, “The Rise of the Reluctant Innovator,” self-published in late 2013 with a follow-up, published by Kogan Page, released in March 2016.

Mark Malhotra | Innovation Advisor | CARE International UK

Mark Malhotra, Innovation Advisor for CARE International UK supports a number of social enterprises that CARE owns and operates globally. He provides technical support to the teams from business planning and financial modelling to operational guidance and hands on support. Prior to joining CARE Mark spent six years working in the telecommunications sector with a focus on marketing and partnerships. He has extensive experience working across organizations with IT, finance, sales and brand teams. He moved into the NGO sector through overseas placements in Jamaica with a local organization and in Egypt with the Aga Khan Foundation.

Karen Vandergaag | Analyst | CARE Access Africa

Karen is an analyst with the Access Africa program where she supports the LINK Up program’s monitoring and evaluation, CARE’s VSLA management information system, and the human-centered design process for the Digital VSLA project. She has previously spent time in Malawi working a youth entrepreneurship initiative, and a year in Brazil on a cultural exchange through Rotary International. Karen holds a Bachelor of Business Administration Honours from Okanagan College.

Meet the Teams: Journeys of Transformation

Globally, women have lower literacy and numeracy rates than men, less access to financial services, lower rates of school completion and less access to current information or technology about banking or financial entrepreneurship. A growing “digital divide” reflects how women also have lower adoption rates for digital technology, including mobile banking. In Rwanda, the mobile phone penetration is relatively high, with 77.8 % of the total population owning mobile cellular telephones. But despite the fact that women’s main work is done inside their household contexts, the majority of women’s financial empowerment approaches (including VSLA) typically take place outside of the household. This does not recognize that many women operate and need to negotiate relationships within the household and can result in interventions that may not support women’s economic empowerment or improve their low status in households.

The intervention proposed is based on experience of adapting and adding to classic VSLA methodology to specifically address household power dynamics, domestic violence and division of unpaid workload issues that are often at the core of inequitable gender norms. This “Journeys of Transformation” approach has been tested in one country (Rwanda) and shows promise. The families of men who participated in these group sessions saw significantly higher income gains compared to those families who did not participate.

CARE Rwanda is experienced in engaging men for gender equality and women’s empowerment program. Research on CARE’s engaging men interventions has shown that if they are effectively engaged with an appropriate model, men can support their wives to fully enjoy their rights in a broader sense and challenge inequitable gender norms that prevent women from reaching their development potential.

Meet the Team


Doris Bartel | Senior Director, Gender and Empowerment Unit | CARE USA

Doris Bartel leads CARE USA’s Gender and Empowerment unit which works to achieve meaningful progress on women’s rights and gender equality in CARE’s programmatic strategies.  She works with teams around the world to apply innovation and best practice for more targeted gender transformative strategies in addressing root causes of poverty and injustice.  She has led qualitative and participatory action research to explore sensitive topics such as intimate partner violence, expression of sexuality, and child marriage as well as issues affecting children and their families at the end of life.  She leads CARE USA’s representation in gender related consortia, including co-chairing the Interagency Gender Working Group’s Gender-Based Violence Task Force led by USAID’s office of Population and Reproductive Health.

Janvier Kubwimana | Project Manager | CARE Rwanda

Janvier Kubwimana is the Project Manager of a NORAD-funded Gender Equality and Women Empowerment Project, Janvier joined CARE Rwanda in 2011with 6 years of experience working in Development and Health sector in Rwanda where he specifically worked for UNFPA coordinating its Gender, Sexual & Reproductive Health, Population, and HIV/AIDS interventions in different districts of Rwanda. He holds a Master of Arts in Development Studies and a Bachelor’s Degree in Public Health.

Bena Musembi | Country Director | CARE Rwanda

Bena Musembi is a results-oriented development professional with 20 years of experience in international development. Currently as CARE Rwanda’s Country Director since September 2015, and previously as CARE Burundi’s CD, she has successfully lead organizational change management processes, and overseen diverse development and humanitarian interventions in roles as Chief of Party, Deputy Chief of Party, Head of Programming and Learning, Senior Program Officer and Market Researcher in multi-country contexts.

Lea Liliane Niyibizi | Project Manager | CARE Rwanda

Lea Liliane Niyibizi is the Project Manager for Indashyikirwa Project, a GBV prevention project funded by DFID, Lea joined CARE Rwanda in November 2014 with 12 years’ experience working in Gender, GBV prevention and GBV response in Rwandan Health Sector; She has worked especially with Ministry of Health to develop Health providers training manual for management of GBV cases and she has worked on integrating GBV OSC (One Stop Center) in District Hospitals. She holds a Master of Arts in Project Planning and Management.

Sidonie Uwimpuhwe | Program Coordinator | CARE Rwanda

Sidonie Uwimpuhwe is the Coordinator of Vulnerable Women Program in Rwanda since 2012, she has joined CARE Rwanda with 10 years of experience working in the public health sector as a senior civil servant. Sidonie is a seasoned senior professional with a wider range of experience in gender equality and women empowerment that includes women economic empowerment; prevention and response to violence against women and girls; women’s leadership and political participation; engaging men and boys for gender equality; grassroots activism and women collective action, advocacy, civil society strengthening, etc. She holds a Master degree in Public Health and a Master of Science in Gender and Development.