CHAPTER 7
Applying Savings Group Principles to Other Development Initiatives
A lifetime in development has taught me that the only practical way to serve the poor at a scale that makes a difference is to tap villagers’ organizational acumen and aspirations for a better life. The skills that have enabled these villagers to survive exploitation, drought, and political adversity have been honed over centuries. In the face of uncertainty, their survival has always been “in their own hands.” The fight for survival goes beyond geographic areas and religions. Savings groups have been promoted with equal success across Muslim Africa, Buddhist Asia, and Catholic Latin America because the prudent management of financial resources is a universal need. This chapter shows that the principles underpinning successful savings groups—relevancy, simplicity, extraordinarily low cost, local control, no giveaways, and viral replication—can be applied across the development spectrum. Interventions in education, agricultural development, public health, business education, political advocacy, conflict resolution, and women’s empowerment can be designed to reflect these principles. Hope is power.
Applying Development Principles
International development practitioners can help communities take development into their own hands in many different types of programs by incorporating the high performance characteristics used for savings groups. Adherence to the principles introduced in chapter 1 will greatly increase the odds of long-term success, whatever the type of intervention.
One example of using these principles is Brazil’s Cistern Program, which catalyzes the problem-solving capacity of rural communities to address the lack of water in the semiarid region of the country, which suffers from severe water shortages, with highly irregular rainfall throughout the year.1 In response, the Brazilian government has spent billions of dollars to divert the São Francisco River to supply farmers with water, but the result has been to take water away from smallholder farmers and direct it to cities and large agribusinesses.2
Smallholder farmers and civil society groups in the northwest semiarid region realized that it was up to them to come up with a workable solution. In 1999, they banded together to form the Brazilian Semiarid Association and devised a plan that was simple, easy to scale, low cost, and driven by the community. Members of the association took it upon themselves to teach community members how to build different kinds of cisterns and better conserve water. The Brazilian Semiarid Association later partnered with the federal government to receive additional funding, and within a decade more than fourteen thousand people had been trained in how to build cisterns, and more than four hundred thousand families had cisterns to provide water for their small farms.3 The top-down approach for addressing water scarcity in this region failed to reach those who needed it most. When the initiative was “in their hands” and led by those who would directly benefit, it achieved its goal.
Savings Groups as Platforms for Innovation
Just as these principles can be used to design a variety of community-based development projects, savings groups themselves can serve as effective platforms for development and empowerment initiatives. Communities have added smallholder agriculture in Central America and Zimbabwe, malaria education in Mali, HIV/AIDS education and literacy programs in Nepal, and other issues of importance as determined by members of local savings groups.4 Building on the financial clout and social capital of savings groups, these groups find it comparatively easy to address other community-wide issues.
For example, in 2006, Freedom from Hunger launched its Microfinance and Health Protection Program, in which women who participate in savings groups discuss relevant health issues like breastfeeding, family planning, and child nutrition in addition to learning wealth-management skills. In India, the program goes beyond health education to provide access to preventative healthcare. If a doctor detects a problem, the women have access to health loans, health savings, and health microinsurance to help pay for the treatment.5
In Uganda, the Aga Khan Foundation has used savings groups as platforms to market solar lighting, which for rural communities has various health and cost benefits compared with traditional kerosene lamps.6 Just as these villages are too rural for traditional financial institutions, they are often too rural to be part of a formal power grid. The program uses the savings groups’ knowledge and elevated status in local communities to provide a simple solution to a widespread problem.
Another example of using savings groups as a platform for other types of development is a soil-fertility program that I helped introduce in Mali. In 2011, I contacted Roland Bunch, who built his reputation by rebuilding exhausted soils in Honduras and Guatemala,7 and asked him to come to Mali. He had recently turned his attention from soil rehabilitation for small-scale rural farmers in Central America to Africa. Collapsing soil fertility is not just a problem for Mali—Bunch explained that “the entire lowland, drought-prone area of Africa’s Sahel region is poised on the edge of severe hunger, even famine”—but the impact of this impending crisis can be lessened if soil fertility is restored for small-scale farmers.8
Over a few days, Bunch and I developed an agricultural intervention that built on the Saving for Change groups already in place. It was, like the savings groups, scalable, simple, locally controlled, and self-replicating. Each aspect of the design reflected the principles that made savings groups successful:
• A vision of scale and self-replication This was a project not only for a handful of villages but for the entire Sahel. By encouraging the spread of ideas through peer exchanges, what was learned in one hundred villages will serve as a learning laboratory to bring these services to thousands of villages over the next years.
• Less is more, and the simpler the better The project built soil fertility by introducing plants and trees that nourish the soil and require minimum labor. It was simple enough that it could be introduced by trainers who are not agronomists.
• Build on what is already in place The project used skills and tools that community members already had, such as knowledge of intercropping. The focus was on growing food for subsistence because, as once stated by John Ambler while at Oxfam America, “the first market is the stomach.”
• Be sustainable The project introduced techniques that did not require purchased inputs such as seeds or inorganic fertilizer.
• Keep costs low No specialized tools, chemical fertilizers, or other agricultural inputs were required for the project.
• No giveaways Even seeds needed to be purchased.
• Insist on local control Roland introduced the program through women’s Saving for Change groups and then got out of the way.
• Establish high performance standards and insist on meeting these standards Each animator was assigned a cluster of villages and held accountable for their performance.
• Embrace learning and innovation We included constant evaluation as a part of the project, with an eye to building to scale and disseminating outcomes. Also, turning over complete control to the groups allows them to adapt the program over time to better fit their needs.
This initiative with smallholder farmers in Mali addressed several issues: It helped rebuild soil fertility, provide food and fodder, increase agricultural production, and raise the water table by helping to have more water percolate into the soil. As the trees were trimmed so that they did not provide too much shade, the cuttings also provided firewood for cooking. These outcomes may seem small to higher-income urban dwellers in the global North. However, for subsistence farmers in poor, rural societies, these improvements not only increase their incomes but also help preserve their livelihoods for the next generation and make them significantly more resilient to shocks from conflict, climate change, and drought.
While projects aimed at increasing financial inclusion and improving soil fertility may seem to have little in common, both savings groups and this agricultural intervention worked from the same basic development principles. The savings group was used as a platform to organize community members to address a pressing problem felt not just by them but the entire region.
The organic spread of good ideas is the most efficient, sustainable way to create change in any sector. As I have said throughout my work, “They know how.” The same way traditional ROSCAs spread throughout villages, peer-to-peer networks have been effective at spreading knowledge on how to treat fevers, to make soap, to exclusively breastfeed, to take antiretroviral drugs for combating HIV, and to intercrop to boost agricultural productivity.
Empowering individuals and communities to take development into their own hands is the most efficient and effective way to create large-scale, durable change in the poorest and most remote communities in the world. Using this model for savings groups, I have seen the positive effects spread far beyond financial inclusion.