Village Savings and Loan Associations (VSLAs), often referred to as 'merry-go-round chamas,' are self-managed and self-capitalized savings groups that use members' savings to lend to each other.

The Simawet women's chama group in Kaptembwa has successfully empowered its members by increasing their access and control over resources, leveraging collective power to overcome social and financial barriers.

Ann Soi, the group's Chairlady, shares with Mtaa Wangu that the group began six years ago, when the women from the same village started contributing money to purchase home equipment for each member.

"When we began, we started by buying home equipment like sufurias, plastic chairs, and plates for members to use during occasions, as we used to spend a lot of money renting such items," she explains.

Ann mentions that the 20 members later decided to incorporate savings and loans into the group, thus introducing Sh. 500 as savings and Sh. 2,500 for the merry-go-round contribution.

Members of Simawet Women Group during the monthly group meeting on July 10, 2024.

Photo credit: MUTHONI WANJIKU/MTAA WANGU

Therefore, each member is required to give Sh 3,000 every month.

"The merry-go-round contribution is distributed to members monthly, allowing each member to receive up to Sh. 50,000 for individual projects," she notes.

Ann reveals that they meet monthly, enabling members to save money and access small loans in case of emergencies.

Members who receive loans repay them with a 10 percent interest rate, which has helped them pay for children's school fees, purchase land, build houses, and grow individual businesses, thereby improving their families' livelihoods.

"We are working to ensure all members acquire land and build their own houses through our savings, as some members are still young," she says.

The group consists of 20 members, with ages ranging from 34 to 60 years.

Ann emphasizes that the group has undergone financial literacy training to help members understand the importance of budgeting, saving, and debt repayment.

"All members who take a loan have three months to repay it. Failure to do so results in a three-month ban on taking another loan, even after repayment," she states.

Ann concludes by saying that the group aims to enhance women's economic independence through improved financial inclusion and avoid dependency on asking for help.

Inside Kaptembwa's strict chama group that has changed women's lives

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Muthoni Wanjiku