Money might not be growing on trees in Vanuatu’s southern Tanna Island, but for the members of new Village Savings and Loan Associations watching their savings grow is the next best thing.
More than five million people are part of CARE’s Village Savings and Loan Associations (VSLA) all over the world. With support from the Australian Humanitarian Partnership (AHP) COVID-19 response, more communities on the island of Tanna in Vanuatu have joined them and are seeing the financial benefits.
CARE’s VSLA program was first launched in Niger in 1991 to harness the ancient practice of group savings. VSLAs offer group members a safe way to save money and access loans and can be especially game-changing for women, who often face significant barriers to accessing financial services and achieving financial security. VSLAs are a savings-led approach to microfinance, in contrast to a credit-led approach, making it less risky for group members to take a loan. This is particularly important for VSLA members in Tanna. They are currently facing extraordinary challenges earning and saving money as a result of the economic impacts of closed borders due to COVID-19 and Yasur Volcano ashfall.
With AHP’s support, CARE in Vanuatu has established five new VSLA groups since 2020, including one in Lamtehekel, Tanna. Established in February 2021, the VSLA Lamtehekel group has 30 members – 25 women and five men (including one man with a disability).
Through a 12-month cycle, the group is being supported to elect a committee, develop a constitution, and hold their first savings, loan, and loan repayments meetings. CARE is also providing practical stationery materials and conducting monthly visits to check on their progress.
Marie Chantal Willie is a 39 year-old member of the Lamtehekel VSLA group. Originally from the island of Malekula, she moved to Lamtehekel some years ago after she married. Before joining the VSLA group, Marie says she did not prioritise savings and her husband made the final decisions about their expenses.
The VSLA has helped Marie and other group members to see the importance of prioritising savings and managing expenses and has provided an opportunity to save money in a safe, trusted place.