CULTIVATING A COMMUNITY
The savings group, Flor de Santa Cruz, was formed in March 2015 as part of the Promoting Economic Opportunity for Young Women and Girls project, jointly implemented by Trickle Up and our local partner FundaLachua.
After the group was formed, participants began saving, skills training, and business plan development. In addition to the typical Trickle Up economic strengthening program, this project is also educating young women and their families on sexual and reproductive health and rights.
Businesses were started in August 2015 after each participant received their $75 seed capital grant. As of September 2015, the group had 14 members and had already put $41 into their savings fund. They also started a social fund, which had $9 in it, and which can be tapped into if a member has a need for emergency funds. The group created an administrative committee, including a president, secretary, and accountant, to oversee the savings fund and lead strategic tasks. Even though their savings were small, the women of Flor de Santa Cruz were proud of what they’d been able to put away so far. Before, none of the women in this group saved, as one of them noted, “we didn’t think we could.” They were intimidated by this new practice and nervous their savings could be lost or stolen. But they could anticipate the money they will have at year’s end to grow their businesses and were motivated by the interest on loans given to other group members that helps them grow their savings even more. Loans are issued to group members once the group analyzes how the money will be spent and once they are sure the person has the ability to pay it back.
Because the participants in this project are young, permission to belong must be sought from their parents, but it also allows for the whole family to participate in the program. Parents often give their daughters money to put in the savings fund to increase the economic opportunity for the whole household. The savings group has become more than just a buttress for family stability, it is now a social support for the women as well. Before starting in the program, they didn’t know each other well, often didn’t get along, and had no reason to try. They were not encouraged to get out of their houses and interact with one another. Now, they like to spend time together, laughing and joking, or sharing knowledge at trainings and meetings. At the beginning, some people in the community criticized how often the group meets. But, as one participant said, “They will stop making comments when we move forward successfully and add more members to our group.”
After nine months of saving, the members of Flor de Santa Cruz savings group collectively saved $261.
They gave out loans to members, rotating who received a loan to invest in their new businesses and ensuring that the money was returned with interest in order for everyone to receive a benefit from the loans. They accumulated $88 from interest and penalties on late payments, and the value of the members’ shares in the savings group increased at least 30%.
The group went through some administrative changes as well. Several members in leadership roles stepped down for new members to take their place. Elvira was the keeper of the lockbox that contains everyone’s savings, but has since passed on this role to Hilda. Mirna became the president of the savings group, which is a new role for her as well. The savings group adapts and changes as its members build their new businesses, become more comfortable with saving and accessing credit, and actively engage in their community.
After their first year, the 11 young women of Flor de Santa Cruz savings group had saved 278 shares and increased the value of their shares by 11%.
In Trickle Up savings groups, participants contribute to their accounts by purchasing shares in the savings group on a weekly basis. Participants who save more have more shares in the group and those shares increase in value when members pay back the low interest rate loans extended by the savings group. At the close of this first year, members of Flor de Santa Cruz each had an average of $35 in savings and accrued interest, and one member had $53!
In addition to saving in their own accounts, the women of Flor de Santa Cruz each contributed to the communal fund at savings group meetings. The group uses this resource as a small insurance plan, helping each other out to cover medical costs when they get sick and providing money to elderly women living in extreme poverty in the community.
The young women say the savings group is valuable to them because: “At home it is difficult to save because we end up spending the money, whereas we can’t spend it if it’s in the group.” In addition, they like that “our savings generate profits and we can receive loans.” By the end of the first year, the 11 young women fully understood and experienced the benefits of being in a savings group. It wasn’t just their ability to save and take out loans, but also their increased self-esteem and sense of belonging that showed them the value of their savings group.
The members of Flor de Santa Cruz are strong women who get along easily and love to joke around. If someone doesn’t attend a savings group meeting, the other girls bug her to come next time. The young women find the group meetings are a good reason to have some fun together and leave their chores and work for a while.
Eight of the original 11 members of Flor de Santa Cruz elected to continue in the savings group for the second year. After just nine meetings of this second cycle of saving, they have collectively saved $68 and generated $6 in interest. They now understand better how to run their savings group and they enjoy doing so. One of the benefits of the group, according to these young women, was learning to overcome difficulties and interpersonal conflict together. The women told us that now “we want to save more and achieve more profits. Therefore, we are lending out more than last year, and this way we will generate more interest by the end of the second cycle.” They have agreed to all give loans to each other so that everyone can contribute and increase the fund with the interest generated.
The Flor de Santa Cruz savings group also completed trainings on sexual and reproductive health and rights as part of an additional program component to reduce child marriage, early pregnancy, and gender inequality. As you will see in their own words, the young women and girls have learned a lot about these important topics and are poised for personal and professional success as they graduate into sustainable livelihoods.
Flor de Santa Cruz Savings Group of Santa Cruz el Nacimiento, Guatemala
Budding leaders, young entrepreneurs, friends