This feature was originally published on the Toronto Star’s Africa Without Maps blog in 2012.
Money doesn’t grow on trees, but in the Nkalo village, it grows near one.
In the centre of the village, a tree has become the site of new financial freedom and empowerment for local women—an outdoor Village Savings and Loan Association (VSLA) that is literally taking a grassroots approach to providing women with the opportunity to access a loan.
Roughly 25 kilometres from the ATM queues that are characteristic of Malawi’s commercial capital of Blantyre, 10 Nkalo women meet regularly under the tree to contribute kwacha in amounts that range up to $3, depending on what they can individually afford, and lend to one another.
The microfinance project is overseen by the Centre for Alternatives for Victimised Women and Children (CAVWC) Women’s Rights Programme, and based on the VSLAs first engineered by the aid agency CARE International in Niger in 1991.
According to Chrissy Chibwana, one of the members of the Nkalo VSLA, the alternative micro-lending model has made her more economically independent and better equipped to care for her family.
“Before (the VSLA), I had to ask for money from my husband all the time to buy salt or sugar, or pay for my children’s school fees,” said Chibwana. “Now, I no longer have to wait for my husband to look for the money to send my children to school. I have the power to get money whenever the need arises.
Because the women are lending to themselves, the VSLA model is not only providing women like Chibwana access to loans, but it also allows the women to earn interest and save.
Nkalo VSLA members Dorothy Musaya and Anne Maere said they have been able to lend money and save enough of the interest to improve their standards of living; with Musaya able to buy 24 iron sheets for her house and Maere being able to buy cement, and a mattress.
According to CAVWC executive director Joyce Phekani, such success stories are becoming more common in Malawi as VSLA membership rises each year, increasing economic independence and empowering women who would otherwise be dependent on a man.
“We were finding that women would stick to a relationship where she was being abused because she was not economically independent,” said Phekani. “But these VSLAs are financially empowering women.
“When we first start a VSLA, we find that the women are not empowered, they are really shy, inhibited and can’t see any future with their lives. From day-to-day, we find that these women are able to survive better than in the past. For women who were never able to save anything in their lives, you can see the visible joy that they now have.”
However, challenges still exist in achieving greater gender equality through the VSLA finance model; access to financial resources alone does not automatically translate into empowerment or equality, and according to Phekani, some women are still being short-changed.
“We can’t rule out women who succumb to their husbands, which is a challenge for us,” she said. “Recently, we heard of a woman who had built capital by doing a small business of selling tomatoes. When she was asked where the money she’d earned was, she said she’d given it all to her husband.”
Pece Pearson of Nkalo confirmed that such challenges exist on the ground, saying that “there are some men who steal from their wives and use the money for petty things, like beer.”
To address the issue of not only access but control of financial resources, Phekani said the CAVWC plans to build the capacity of the program through leadership, business management and training workshops. The training will aim to address issues of power relations within the VSLA groups as well as in the family home.
Since CAVWC launched its first VLSA in 2009, a total of 326 VSLAs have been established in the Chiradzulu district in Nkalo, Kadewere and Onga. Of them, 314 associations are exclusive to women who have been historically disadvantaged in access to material resources like credit, property and money.