Chifundo Kamwendo and the Power of VSLs

A lot is made, rightfully so, of VIP’s large-scale infrastructure and development projects. The building of schools, bridges, maize mills, and solar irrigation projects has a huge impact on the people of rural Malawi and these projects are concrete examples of the progress that we are making in combating poverty in the villages of Sakata. But one of our most successful development initiatives is not a new construction project, it is not something that can be seen and touched, it is not about bricks and mortar and concrete, but rather it is about organization and training and the dissemination of knowledge.

One of the biggest limitations to economic growth in rural communities is a lack of savings and credit. To help address this deficiency, VIP facilitates small groups called Village Savings and Loan associations (VSLs). Each VSL consists of 12-20 participants who are trained by our staff on how to save money and pool together their savings into a collective “bank.” Eventually they save enough to make small loans to members of the group. With the loans, budding entrepreneurs have the capital to start a business, provide services to the community and begin making money! Each member is responsible for re-paying the loan, with interest. At the end of the year, each member then receives back the amount they contributed, plus their share of the interest earned, which they can then choose to reinvest in the VSL the following year.

In 2016 our VSLs, involving 200 people, saved over $26,000 and this year they are on track to surpass that number. One of the beneficiaries of this program is Chifundo Kamwendo of Kalino village. Chifundo is married with three children and told us her amazing story when we came to visit her this summer. Chifundo joined one of VIP’s earliest VSLs and accumulated enough capital to start a business selling small bags of popcorn in the markets and along the roadside. It was slow going at first, but Chifundo was smart. She had chosen a relatively cheap product to make, that was in high demand and relatively low supply throughout the villages. With the money earned from her popcorn business, she was able to purchase a sow, which is a nice investment in the villages, as she can keep the sow and her female piglets and sell the male piglets to market or to her neighbors. The profits from the pigs and popcorn allowed her to build a beautiful new house, with glass windows and iron sheet roofing. When we asked her where she lived before she joined the VSL, Chifundo pointed to the small, thatched house, with a dirt floor and no windows or doors, where she keeps the pigs safe at night and said “in there.”

VSL’s are the perfect embodiment of VIP’s approach to development. We are not a charity, giving away money to people that will always remain poor. We are a development organization that provides impoverished people in Malawi with the tools, knowledge, infrastructure and organization to lift themselves out of poverty. There are dozens of women with stories just like Chifundo. Women who have been given an opportunity to better their lives and the lives of their families, thanks to your support. And they are seizing their opportunity with both hands.