Instituting village savings and loan associations scheme through action research in Zimbabwe

Abstract

lage savings and loan associations schemes have become one of the critical survival strategies amidst poverty, inequality and financial exclusion thus helping low income communities to ride out poverty and make their savings and to eke out a living. However, the use of scientific procedures by ordinary people when establishing such initiatives in their villages is under-reported. This study, therefore, sought to test the utility of the action research (AR) methodology in establishing a low cost village savings and loan associations scheme intervention, with a view to assessing the extent to which the scheme can improve the livelihoods of members of the scheme, and draw lessons for future interventions. The process involved planning, designing, establishing and evaluating a village savings and loan association scheme initiative involving 15 individual members (inclusive of the researcher) in ward 8 of Seke district, Zimbabwe. Results showed that creating village savings and loan associations is possible using action research, as community participation in the design, implementation and day-to-day operations of such initiatives guaranteeing ownership and control of the initiative by the host group scheme are almost natural to action research. One of the comparative advantages of using action research is that it creates spaces for ordinary people to share their experiences, reflect, and come up with context-specific solutions, as they take responsibility for their financial wellbeing, thus helping to meet their socio-economic needs and aspirations. The strength of village savings and loan associations is that they can be replicated. The study recommends that in the era of COVID-19, social distancing rules and regulations introduced to contain the virus should be observed.