Introduction to VSLA model

How VSLA groups work?
In this article we are going to chronically demonstrate how a VSLA group function. It is basically the idea of saving as groups of multiple participants and receiving a loan as individuals so that every member in the group receives at least one loan in every annual cycle.

Step 1:
Community is oriented to the VSLA concept.

Step 2:
Individuals opt to join a group and identify their own members (typically 15-25

Step 3:
Members trained on group governance and management. They receive a
lockbox with three locks and three keys, and passbooks for recording

Step 4:
Group establishes a constitution and bylaws, including meeting frequency, rules and regulations.

Step 5:
Group elects a chairperson, secretary and treasurer for a one-year term.

Step 6:
Group sets the price per share and the minimum/maximum number of shares a member can purchase during a meeting.

Step 7:
Group begins saving on a weekly basis and is trained on financial management.

Step 8:
Group adds lending to the routine, making loans to members and collecting
repayments with interest (a 10% monthly rate is typically applied to loans).

Step 9:

After 9-12 months, groups hosts “Share-Out Day,” ending the cycle and distributing savings and profits to members according to the number of shares each has purchased during the cycle.

Step 10:

Most groups quickly initiate a new cycle autonomously.


Timeline of CARE’s saving method movement

VSLA has entered into the third decade of existence and so far has achieved great success in generating local development in poor and vulnerable communities.


. Furthermore it has empowered many women across the world to become economically independent. First begun in 1991 in Niger, you can follow the timeline of CARE’s VSLA movement:

In 1991

CARE pioneers the VSLA concept in Niger as a means of empowering women to pool their savings, then loan one another money to start small businesses or pay for important life expenses. Those original groups were called Mata Masu Dubara, “Women on the Move.”


In 1993

VSLAs expand beyond Niger for the first time, into Mozambique. They have since spread to 26 countries in Africa and 9 countries beyond the continent. VSLAs were a key piece of CARE’s program to help Haitians rebuild their country after the 2010 earthquake, for instance. And they have taken root in Afghanistan, where groups apply service fees instead of interest, which is forbidden under Islamic law.


In 1996

World Vision becomes the first peer organization to adopt CARE’s VSLA model. Others followed suit. As a result, more than 10 million people are engaged in VSLAs and groups like them across Africa.


In 2001

CARE takes VSLA to East Africa, introducing it in Zanzibar and then mainland Tanzania before scaling across the region. The region today hosts more groups and members than any other.


In 2007

CARE VSLA membership crosses the 1 million-person mark.

In 2008

CARE launches Access Africa — a signature initiative focused on massively scaling VSLAs and access to a suite of financial services across the continent.


In 2009

Barclays, CARE and Plan International launch the first partnership between a global bank and non-profit organizations dedicated to linking savings groups to formal financial services. VSLA success story Goretti Nyabenda of Burundi appears on the cover of the New York Times magazine with the headline “Why Women’s Rights Are the Cause of Our Time.”


In 2010

Niger’s Mata Masu Dubara organizes a national convention in Niamey, Niger, where hundreds of VSLA members across the country gather to discuss how to better assert their political influence.


In 2011

CARE launches a firstof- its-kind partnership that uses mobile phone technology to link VSLA groups with formal banks.


In 2013

Former U.S. President Bill Clinton tours the Tanzanian neighborhood where the Banking on Change program was introduced as a joint effort among CARE, Plan and the Clinton Global Initiative.


In 2014

Existing networks of VSLAs expand in Liberia and Sierra Leone during the Ebola outbreak, as people see firsthand how savings groups become safety nets and critical information sources. CARE VSLAs surpass 4 million members.


In 2016

CARE and Visa pilot a mobile app allowing VSLA members to record financial transactions so they can

establish a credit history and qualify for loans. CARE VSLAs surpass 5 million members.

There are 1.1 billion “unbanked” women in the world without resources to financial services and credit. CARE’s experience has shown that those participating in VSLAs are more than ready for formal banking services. As VSLA groups mature, so grows their need for more diverse financial services like insurance and a more secure place to keep their savings and extra cash. Demand for larger and longer-term loans also increases, particularly at the beginning of a group’s cycle, when savings are minimal. To fill these gaps, VSLA groups increasingly need to link with formal banks. And CARE is making that happen. The payoffs can be significant. Once linked with a bank, group member savings increase between 40 percent and 100 percent, and the average profit per member doubles. It is through these linkages that CARE will map the next frontier of VSLAs. We can give you more than a billion reasons to join us.



You can contribute directly to CARE for covering operational expenses associated with developing VSLA. Some main expenditures are as follows:


24 CHF

supplies a VSLA start-up kit, including a

savings lockbox and ledgers.

88 CHF

buys a bike so a CARE agent can travel among

villages to train residents on the VSLA model.

1900 CHF

funds the organization and training of one

CARE Village Savings & Loan Association, which

will financially empower marginalized women.

Donate today at

And also make sure to Visit to learn

more about CARE’s efforts to economically empower women.


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