VILLAGE BANKING GOES DIGITAL

Over the years it has been observed that some Village Savings and Loans Associations (VSLAs) also known as Village Banks (VBs) or Saving Groups SGs) tend to have excess funds, a situation that leads to groups keeping money cashboxes. This poses a risk to Treasurers who are the custodians of capital. This insecurity forces the Saving Groups to over extend the repayment periods and in some instances imposing credit on members and thus increasing the chances of default. It is against this background that the Churches Health Association of Zambia (CHAZ) has partnered with the Rural Finance Expansion Programme (RUFEP), a project under the Ministry of Finance to digitalize the Village Banking services.

CHAZ is working with the Zambia National Commercial Bank (ZANACO) Plc in the area of Agency banking as well as mobile banking in order to facilitate opening of accounts that will enable the VSLAs/SGs/VBs and their members to conduct their transactions (saving, lending and social fund transfers) as well as access other financial services.

CHAZ trained eight Field Agents and two Field Officers from two of its member institutions, St. Theresa’s and Mpongwe Mission Hospitals from 3^rd March, 2021 to 5^th March, 2021 on the use of the Saving Groups Information Exchange (SAVIX) Application to use in the collection of data and writing reports of the Saving Groups instead of the usual paper data collection forms.

CHAZ has through its member institutions promoted the formation of VSLAs using its Community Managed Microfinance (CMMF) village banking model since 2010. This has been done in order to help facilitate continuous access to appropriate financial services. The Association has also provided training in various skills for the rural poor to enable them engage in sustainable small businesses. 

The project aims at enhancing the capacity of VSLAs to access financial services through the use of mobile platforms provided by Zamtel, Airtel and MTN. It will be piloted in the St. Theresa’s and Mpongwe Mission Hospitals’ catchment areas in Mpongwe District on the Copperbelt Province.

It is anticipated that the project will contribute to deepening of rural financial inclusion while improving the livelihoods of the target beneficiaries.