Saving to create a better future
Cartier Philanthropy has been invited by CARE to attend a meeting of Rosana, a Village Savings and Loan Association (VSLA) at Carrefour, south of the Haitian capital Port-au-Prince.
There are 33 of us, packed into a small room barely four metres square in size. A few rays of sunlight slant through the window. The door is closed with a heavy bolt.
In the centre of the room is a plain wooden table on which a triple-padlocked light blue chest has been placed.
We have been invited by CARE to attend a meeting of Rosana, a Village Savings and Loan Association (VSLA) at Carrefour, south of the Haitian capital Port-au-Prince. Since 2008, CARE has set up and supported more than 500 Village Savings and Loan Associations in six communes (districts) in Haiti, with a combined total of more than 14,000 members, 72% of them women. Carrefour has 206 of these groups.
These associations have around thirty members who pool their savings on a weekly basis. The amounts saved range from 50 to 250 Gourdes (€0.90 to €4.50).
Members can then borrow at a fixed monthly rate agreed by the group (this group has set its rate at 5%) for a period of one to three months. The emphasis is always on responsible lending: borrowers are required to save 10% of the sum they wish to borrow in advance. The amounts loaned depend on the funds available, the purpose for which they will be used and the level of repayments individual applicants can afford.
At the end of each cycle, which generally lasts a year, the interest accrued is shared among group members in proportion to the amount each one has saved.
In a few weeks’ time, the Rosana group will complete its second cycle, which means that its members have been meeting and pooling their savings for nearly two years. From the third cycle onwards, CARE will help to put them in contact with a micro-finance institution (FONCOZE), enabling them to access formal loans of between €1,000 and €1,500 for the first time.
The meeting begins. The proceedings have the air of a religious ceremony: the session opens with a prayer – and will close with a prayer, too. For now, members are not referred to by name: they are “number one”, “number two”, “number three” and so on. In a solemn atmosphere, the group’s president asks each participant for 10 Gourdes for the solidarity fund. Members who are absent will receive a fine of 7 Gourdes. When the collection is completed the treasurer announces the fund total: “1,918 Gourdes”. Everyone present repeats this figure out loud: this money will be useful in case of illness, death or loss of property.
The meeting continues, moving on to savings: each member of Rosana pays into the cash box what he or she has been able to save during the past week. The secretary makes a note of this sum in their personal savings book. The secretary and the two account managers – elected on an annual basis, along with the president and the treasurer, forming the group’s management committee – supervise the transactions.
Glacide Valine has been president of Rosana for eleven months. Before joining the group she tried to make a living from small business ventures, but it was always very difficult to manage.
“With the loans I’ve been able to obtain I purchased underwear and sold it on. I’ve got three children and this business helps me pay for their uniforms and send them to school without too many worries.”
The meeting moves on to repayments. “Number 28” has to repay the loan he applied for two months ago. His name is Jacob Bernise and he is a pastry cook. He has six children and has been a member of Rosana for eleven months. “One day the secretary came and told me about the group. He explained how it works and I was interested immediately. I’ve already received three loans – I’ve just repaid the last one today. With the loan I bought flour to make more cakes and sweets. Now I’ve got a store where I keep all my cooking equipment and a gas oven.”
The savings cycle comes to an end in few weeks’ time and so no-one applies for a loan: they would not have the time to repay it before the next cycle starts.
The session closes, and everyone relaxes.
Outside, we spoke to Castor John-Smith. He is 31 years old and teaches physics in a Carrefour school. “It’s a very effective system. Previously people had no access to credit – now they do. Saving isn’t complicated – everyone is free to save according to their abilities and their needs.”