Let's talk about money.

What would you do if you didn’t have access to a bank? No checking account, no savings account, no debit card or credit card. What if you suddenly found yourself in need of money to pay for health care or school tuition or a funeral, but the nearest bank is hours away and your chances of even qualifying for a loan are slim to none.

The majority of Rwandans find themselves in this position. Banks are few, lines are long, and processes are complicated. Loan applications are long and complex, require abundant evidence of your assets and ability to repay, and can be an extremely long process. Just like in America, Rwandans want financial security. They want to be able to manage their household income and borrow money if and when they need it. As they earn income from farming or handicraft sales they want to be able to save their money in hopes that down the road they can purchase a goat, a cow, or fertilizer to improve their crop yield. Yet, they do not have the luxury of having a bank in every town, an ATM around every corner, low interest rates, etc. So what do they do? Like for so many other things, they come together as a community, pool their money into savings and allow members to access small scale loans in times of need. What they have been able to do on the community level with cooperatives and internal savings and lending groups (ISLGs) is downright impressive.
Today we were able to visit one of these groups, a cooperative named Working Together located outside of Butare, Rwanda. The group is made up of 30 community members, 24 women and 6 men. Every two weeks the group meets and each member must contribute 200 Rwandan francs (the equivalent of about 36 cents) to a pool of money that is kept in a wooden or metal box by the treasurer (unless the groups pool gets too large and then they usually open an actual bank account with a microfinance institution or Rwandan bank). The box has three locks and while the treasurer has a key to one lock, two other members of the Co-op have the other keys; this ensures transparency, and limited corruption and misuse of the co-ops funds as the box can only be opened with all members are present. Working Together has pulled together 215,000 RWF, and members can access this money in the form of loans at any time as long as they are an active member of the co-op and have a good financial standing within the co-op. The purpose of the loan must be clear (school fees, medical bills, etc) and must be repaid within 2 months plus interest. Interest rates vary among co-ops/ISLGs but Working Together charges 5% interest, regardless of the amount loaned. The profit made on the interest goes back into the pooled account, continuously increasing the group’s savings. From what I gathered the co-op also uses some of the savings to purchase seeds and plant communal food crops that they sell on the local market.

This was just one group and thousands exist in Rwanda, many focusing on only savings and lending, which is what we’re focusing on this week. But throughout training we’ll be exposed to other cooperatives, which focus on farming and other income generating activities, and many of which bring together particular subpopulations: OVCs (orphans and vulnerable children), women, and PLWHA (people living with HIV/AIDS). But it is fascinating to see the extent to which communities are coming together to solve their own problems, and it is this community based development that we will be jumping into at our sites starting in May.

So, next time you throw down that credit card or stop by an ATM, think about how lucky you are. Think about if those resources and institutions didn’t exist. What would you do?

In other news, training is chugging along. I haven’t received the results of my first Kinyrwanda test, but I feel like I’m mastering how to 1) introduce myself, 2) talk about my family, 3) identify items and bargain in the market, 4) count and 5) talk about happy and unhappy events. So yeah, I can converse with most 2 year olds, but that’s about it. We were able to coerce our handlers to take us into Butare for lunch today and I splurged on a chocolate milkshake and grilled ham and cheese sandwich. It was pretty much divine, particularly remembering what really cold beverages taste like (regardless of the fact that the “milkshake” was actually just cold chocolate milk)!! We’re going to Nyungwe National Park on Saturday for hiking and monkey trekking! It’s a couple of hours southwest of Nyanza, provides water to 70% of Rwanda and actually holds a spring that is currently believed to be the most remote source of the Nile. I’m excited to get out and enjoy more of Rwanda, particularly considering it involves waterfalls, birds and primates.
So that’s it for now, until next time…