15 Mar SAVINGS GROUPS IN PARAGUAY
Based on the lessons learned through our experience in the Dominican Republic with PROSOLI, where approximately 500 groups were created, we were encouraged to use this methodology in Paraguay. First, the methodology was explained to participants who were then asked about their interest in using such a savings scheme. Based on the interest expressed, we then worked hand in hand with the social promoters of the programs to form the groups. Since then, the promoters have been visiting the groups on a monthly basis to offer guidance and support, as well as train members on advanced options, such as the possibility of giving loans to each other.
The savings and investment groups are self managed and consist of 10 to 25 people saving together, who can also take small loans from the common fund and have a “Social Fund” that covers emergencies and administrative expenses. The activities run in cycles of up to 12 months and, once a cycle is over, savings and accumulated earnings are split between the members according to each person’s contributions. The main goals of the Savings Groups are to:
- Create the habit of saving and a payment culture,
- Help members achieve financial goals,
- Generate confidence, planning, punctuality and discipline,
- Foster solidarity through the Social Fund, and
- Promote linkage with formal financial institutions.
To date, 20 groups have been created, with an average saving of Gs. 550.000 (100 USD). Once the groups were consolidated, the social promoters trained them in the offer and management of loans to their members, To date, just one of the groups is offering loans to its members, while the rest have prefered not to offer this service yet. Some participants claim that they’ll only ask for a loan in case of emergency and/or to buy animals.
Marcos Cuenca, a social promoter in charge of three savings groups in the district of Carayaó, shared his experience with us: “As a promoter, I’d like to congratulate all the families I’m working with, because the three groups have shown a high interest and put much effort into their future progress. It is a great pleasure for me to realize that the workshops were so successful and that they will pay off!”
Vanezza Lezcano, the promoter in charge of the group “Mujeres Unidas” (United Women) Choré expressed her admiration for the trust and unity that the women participants have developed. In this group, four of the women have already asked for a loan from the common fund. María del Rosario Chaparro Gayoso, president of another group, says that she is saving money for the first time, since she used to save only in-kind or animal assets. She greatly appreciates this opportunity and her savings group, composed of 15 women, is very excited by the prospect of saving together and have high respect for each other.
We’ll keep updating you about this experience in Paraguay, where we hope the saving cycles are fruitful and promote the habit of saving between the participants and their families.