It is a Thursday morning. Nearly 20 people pour into the cramped meeting room of a building in the small Kenyan village of Kinja. On the table in the middle, bank notes are piling up. The men and women have come for their monthly savings group meeting. Their mobile phones light up, indicating their money has been deposited.
Mavuno means “harvest” in Swahili. Mavuno groups are savings and lending groups composed of 10 to 30 people. Each member saves a small predetermined amount. These savings are collected at the meeting. From this collection, the group gives out the full loan to several members depending on their needs. At formation, it is best practice for the groups to craft a constitution that governs the interest rate and repayment terms. Members taking out a loan can buy seed or farm tools, for example. Since 2006, Swisscontact has already helped to establish 1,990 Mavuno groups with 44,538 members, 76% of whom are women from Kenya, Uganda and Tanzania.
Until now, group members have recorded their deposits and loans manually in books. This way of accounting is on a low-threshold level, but it is also subject to errors and lacks transparency. For this reason, the Swisscontact project team has sought out cooperation with a Kenyan software developer, Digital Vision, who created a user-friendly and adaptable software called Chamasoft, to guide the Mavuno groups into the digital age.
With an app that has been adapted to the special needs and opportunities of Mavuno groups, all deposits and loans are recorded digitally. Each group member can access the app’s online platform and receives a message on their smartphone with the amount of the deposit made. Whoever doesn’t have a smartphone will receive a simple SMS – in Kenya, the majority of the population owns a mobile phone. Using the app, all group administrators can see at any time who has the highest savings, who have taken out a loan and how much, as well as the repayment rates. Group members have a personalised profile where they can easily monitor their own savings.
Digitisation of money flows offers various advantages to the Mavuno groups:
It has been necessary to provide close guidance while introducing the software. In particular, the low literacy rate presents a hurdle that nevertheless can be overcome with the right technical assistance. Since 2017, the app has been implemented in 43 groups with a total of 750 members already. The objective is to digitise 100 groups by the end of 2020.
“I used to keep something like seven books: one each for savings, loans, our social fund, fines, unpaid loans, etc. There was a high risk that I would miss things. Now it is much simpler using the app on the phone,” explains Peter Kamau, administrator and member of a Mavuno group.