Chapter 5: Findings and Discussion
5.8 Significance of Savings Clubs
The aim of the savmgs clubs is to inspire the contractors to be future business entrepreneurs. After saving a certain amount of money the contractors can decide as a club which business to invest in. In that way, when they are empowered new people can be hired promoting further development of their communities. The women are informed after each savings meeting as to the total amount saved for that month. This is appropriate as it prevents the misuse of money and it creates accountability and responsibility by the savings committees. However, some of the women seemed disgruntled about the time it will take to save a sufficient amount to start a business. When some of the contractors were asked about this, five pointed out that they have pulled out of the saving clubs due to various reasons. However, they were quick to state that they will resume saving next year. They stated,
I have stopped saving because I have many responsibilities to cater for with the income, but I hope to continue next year (focus group interview, Nkwalini, 3/11/2005).
Four women said that they sometimes do not see the benefits of the savings clubs, even though they participate in them. One of them said,
My problem is that I have joined the savings clubs but I feel that I want to know what the result will be, because in the savings club in my area, we have tents and tables that we are renting out. However, we do not get any money at the end of the year. I would like to get some money from the tents that are rented, maybe at the end of the year. My other problem is that people that do not save diligently are the ones that are delaying the process of reaping the rewards in the savings clubs because they pay for some months and other months do not. I think that this delays the process of the organization making profit (focus group discussion, Nkwalini, 2/11/2005).
The formation of the savings clubs is a good start. However, in some of the areas, the women are not motivated because they have not seen the benefits of their saving. The inconsistency of some respondents weakens the incentive of other respondents to continue saving in the clubs. The other function of the savings clubs is to promote investment, which would entail women setting up projects for income generating activities. For example, a savings club based at Maqongqo (outside Pietermaritzburg) has ventured into making reflective vests for road workers, which they sell at R25 each (Dimba, interview, 15/11/2005). Even though these clubs are done collectively, they serve an important function in the development of livelihoods by investing a lump sum in income generating activities such as the renting out of tents. However, the inconsistent savings or default by some members raises a key question of sustainability, and whether those currently saving will be motivated to continue. This is in view of the fact that the future of the clubs in lifting the women out of poverty depends entirely on how much the contractors are able to save. Perhaps if they could be motivated to save on a continuous
basis and reminded of the benefits this could bring, this would contribute towards sustaining the savings clubs. Another useful idea would be for the members to save individually and maybe meet as a group.
Respondents are of the opinion that the savings clubs can help them venture into big business, which can generate additional income. Even though this is a positive sign it is a long-term project and the failure of some respondents to contribute diligently might hinder the progress of the clubs. Livelihood approaches focus on livelihood promotion, which increases the resilience of households through improving a wide range of sectors that would strengthen the ability of the poor to reduce poverty, such as savings and credit, involving the community in service delivery. Such activities are normally long-term programmes, which have an element of participation and empowerment (Carney, et al 1999). However, it is important to note that for the savings clubs to materialize and use the money for livelihoods, participants should be committed to save the specified amount each month.
In addition, Zibambele initiated the savings clubs but the women are responsible for their management. This is one way of ensuring that the women become active in their own development. These findings are consistent with the aims of livelihood approaches in ensuring that external support puts people at the centre of development. On another note by introducing the savings clubs, Zibambele is showing that development activity cannot be based in isolation, thus macro and micro level structures are needed. These multiple levels can reduce poverty. The study shows that the poor people should be the principal actors in identifying and addressing livelihood priorities, Zibambele creates the environment where the poor can address their problems. On another note, the study has confirmed that Zibambele utilizes the bottom up approach. For example, the DoT initiated the savings clubs, but the women are the principal actors in the running of the clubs. The Dot merely encourages them to join the clubs, but no one is compelled. The evidence is seen in the Nkwalini study, where some participants said that they had initially joined the clubs but later stopped contributing. Itwas their prerogative to do that.
The women decide when to hold meetings, who to elect to be in the savings club
committee, and what to do with the money saved. The DoT does not in any way control this. The role of the DoT should then be to assist the women in educating them about how to use the money wisely, to attain sustainability of the project.
This is what the savings clubs serve to achieve as the women are encouraged to save monthly and when they have saved a large sum they can decide what business they would want to venture into. From a development perspective, the success of such programmes can only be guaranteed if the community is responsible in driving their development strategies.