Establishing a Savings Group in your Community

The main role played by World Vision staff is to explain the core concepts to the members of the community, train the groups in the step by step
method (below), help to facilitate the initial meetings and provide regular monitoring and support. After the leaders and the attendees
become comfortable with the simple sequence of events that make up a meeting, World Vision staff can step aside and
allow the members to confidently take control of their Savings Group, and their financial futures. Members
of the group can also be trained to train others who can begin their own groups. In this way Savings
Groups are self replicating. It is important that the following steps are followed closely. What makes the
Savings Group model work so well is its simplicity and the logic of how it is structured.

An Introduction to Savings Groups

Having access to credit is vital in any community. It helps people build their businesses and provide for their children. Savings Groups are making this possible in some of the world's most remote and impoverished communities.

Step 1 - Opening the Meeting

The group meets once a month, or more often if preferred. Responsibilities for different aspects of the meeting are divided among several members. Three key-holders are required to open the steel box that contains the group's money. Each member is given their passbook with a record of their transactions.

Step 2 - Daily Savings

Metal tokens were given to members if they deposited money into the box between meetings. After the box is opened to begin the meeting all tokens are turned in by the members that have them, in exchange for their savings. They can now use those savings during the meeting.

Step 3 - Share Purchasing

Members build savings by purchasing shares of the Loan Fund. Each member at the meeting must purchase a minimum of one and may purchase a maximum of five shares. A member can also withdraw shares at this time.

Step 4 - Loan Repayment

Each member who has a loan from the Savings Group pays their monthly installment on that loan with interest.

Step 5 - Calculating New Loan Fund

After all transactions are completed a new total is calculated for the Loan Fund.

Step 6 - Loan Taking

Any member that wishes to take a loan does so at this time. A maximum loan is 3 times that member's savings. The group decides how much each borrower will receive.

Step 7 - The Social Fund

The Social Fund is an emergency insurance fund that members can draw on during difficult times. The use of the fund is decided by all members. Each may draw from it but also each must contribute.

Step 8 - Totaling Balances

The group announces the total balances of the Loan Fund and the Social Fund. The group members are required to memorize those two totals to ensure the transparency of the process. The three locks are put on the box.

Step 9 - Closing the Meeting

Once the box is locked the floor is opened up to any topics members may want to discuss, whether about the Savings Group or the community in general. The date and time for the next meeting is announced and the meeting is ended.