An assessment on the efficacy of delivery channels in group savings and loan scheme in Malawi
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Bachelor Thesis from the year 2021 in the subject Economics - Finance, course: BSc in Community Development, language: English, abstract: Group savings and loan scheme is a time-bound accumulating savings and credit activity. It is an informal microfinance where there are no financial intermediaries. Self-selected persons in a group of at least 15 to 30 people form a group to mobilize their own savings regularly in a pool and borrow from the pool fund and repay back the borrowed funds hereby referred to as loans with interest, after a period usually between one and three months. On a date chosen by the members, usually after about a year, all the financial assets are divided among the members in proportion to each one's savings. This pay-out is called the "action audit". The groups normally reform immediately and start a new cycle of savings and lending. Non-governmental organisations normally build the capacity of these groups to operate efficiently by training them on financial education especially on savings and loan management. More recently, the significance of Savings and loan services reaching financially excluded populations with low cost, easily accessible financial services has attracted interest of many stakeholders globally. There has been a move by nongovernmental organisations to improve the outreach to reach the very poor in remote areas of Malawi and Africa as a whole. Use of different delivery channels have been employed to achieve this objective. One of the key failures of the conventional microfinance has been its limited outreach to remote areas and poorer people in them, especially in rural areas of Malawi. The study aimed at assessing the efficacy of the delivery channels in group savings and loan scheme outreach in Nkhata bay district in specific areas of Traditional Authority Mbwana. Four aspects of savings and loan outreach were assessed: people reached with the group savings and loan, members' satisfaction with the savings and loan
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