It was a bright day, the skies were clear and the sun up scorching as members of the Sakata Comsip Cooperative bakery in Zomba gathered under a tree to update their savings and investments books on a Wednesday afternoon, the last week of February.
Rose Nyambi was among the 20-plus members assembled to contribute her monthly share in sweltering heat in Chimwayi Village in Sub Traditional Authority (ST/A) Mkagula.
Her slight contributions as savings to the grouping since 2006 have enabled Rose to get loans without collateral at a short distance of 200 metres.
Today, her savings have been turned into investments. She has successfully battled poverty, she claims. Other members of the Sakata Comsip Cooperative also share their success stories on how they have prudently invested in productive ventures such as small-scale businesses and agricultural production from their savings.
The savings started as a past time for Rose. Listening to Rose, one admires her love and enthusiasm for savings and investment. Today, she owns one dairy cow, two calves, goats, a decent house and running tap water, things she could only imagine when she was growing up.
“My life has changed. My family is transformed. We have everything. We are food secure, children are going to school and we are able to meet all the necessary costs-things we could only dream about 10 years ago.
“We have battled poverty and we have won. Many in the village have won too all because now we know that savings can make a difference,” she said as she took a team of reporters to her homestead.
“My family living standards are wholly-changed for the best. We were once regarded as ultra-poor in the village but since we embraced the Comsip concept of savings and investments, we are now self-reliant. The dependency syndrome in our mindset is erased for good,” Rose spoke Rose before cameras mounted by journalists.
From the sale of raw milk, Rose ably supports her children and dependents enrolled in school. Her family is also food secure despite the climate change shocks, a frequent occurrence in her village.
Rose has employed a savings first approach where she and other members set aside any amount of money before any expenditure is done as shares to the group and in return gets dividend at the end of the year.
“This mechanism cultivates a habit, and savings-first before spending is then embraced as a habit,” she explained.
Such mechanisms like that of compulsory, mandatory savings, interest savings and share purchase form the bulk of the credit intermediation portfolio of the saving groups and saving cooperatives. Each member possesses savings and loan passbooks and the groups have ledgers. These ensure transparency and accountability.
Other models Comsip uses are Savings – Plus, and Integration approaches. The former is advocated where savings mobilisation is accompanied by various forms of capacity building initiatives to the savers such as business management, technical support, financial linkages and marketing among others along the graduation process.
The skills acquired reinforce resource mobilisation for further saving. The savings groups are encouraged to link with other financial institutions for higher and sophisticated services such as commercial bank.
While in the Integration approach, Comsip Cooperative Union recognises that savings or income alone is not a panacea to ending poverty. Poverty is a manifestation of various aspects that compound the disadvantaged such as the poor struggle to secure income against rising cost of goods and services, threat of ill health and malnutrition. The poor also lack reliable markets, savings and loan services, safe water and sanitation, and quality education of their children among many.
In recognition of this, Comsip includes in its delivery approach elements of poverty. In this approach, Comsip regards poverty indicators as benchmarks for performance for every member of a group or cooperative. Members remind each other of these indicators whenever they meet through reading these indicators compressed into eight points called the 8 Jobs of a member.
As the group members graduate, they are exposed to four categories of business that have a bearing on the environment in their operations as well as an influence on the social fabric. These categories are; production, processing, service and trading businesses.
In Thyolo, the Maguluni Comsip Cooperative ventured into production and this is where Fiskani Nhlane owns six dairy cows and earns not less than K200, 000 in a month from the sale of milk. She milks about 20 litres of milk daily per cow.
With little savings from the public works programme, Nhlane obtained a loan from the cooperative, bought a bull, stall fed it and sold it before reinvesting the money in dairy cows.
She is the steady supplier of milk to a processor in Blantyre. Her story has inspired many members and non-members in Thyolo and she is a model of modesty.
Meanwhile in Karonga, at Twitule Comsip Cooperative Wine Production, Jackson Chilongo is a shining example in Group Village Head (VH) Mwakabanga, Traditional Authority (VH) Kyungu.
Chilongo has abandoned his grass thatched house after building a modern house thanks to the savings he made to the cooperative which enabled him access an affordable loan. As a farmer, Chilongo besides owning goats, he also has pigs which he argues provides him with quick money due to the fast multiplication of the livestock.
Chilongo, a father of three children, argues that from the small business investments, his family has improved their food and nutrition, increased asset acquisition and their better housing in the village has earned them admiration.
The story of how community savings are transforming lives in rural areas in Malawi has also made headlines in Blantyre where members of the Mtikita Comsip Cooperative piggery earned praise from the visiting World Bank mission task team.
Mtikita Comsip Cooperative located in Group Village Head (GVH) Mwangata in T/A Somba in Blantyre District comprises three groups namely Chimwemwe, Chimwankhunda and Chiyanjano. All these were formed out of Public Works Programme (PWP) in 2010 after working on road maintenance, fish pond construction and afforestation sub project with support from the World Bank to government.
The Cooperative has 40 members of which 36 are women and 6 are men. Their objectives like those of many other cooperatives are very clear, but poverty reduction through member owned savings and investments tops the list.
Others are enhancing social economic empowerment through small scale businesses, participating in community work through conservation of natural forest and planting of new trees and contributing towards national development through the realisation of 8 Jobs of a member.
The Eight Jobs include togetherness; community self-help work; improving incomes; creation of assets; improving health status; improving education and literacy; improving food security; and elimination of social injustices.
Collin Andrews the World Bank Task Team Leader, who was in the country last month, encouraged members of the Mtikita Comsip Cooperative, saying the cooperative is achieving intended vision of continued improvement of members’ livelihoods. The World Bank team heard testimonies on how members are benefiting from the cooperative through member owned savings and investments.
Above that the saving level portfolio for Mtikita Comsip Cooperative has been increasing over the years due to members’ interest to invest in the Cooperative. In the year 2015/2016, the portfolio jumped from MK1.4 million to MK2.8 million courtesy of the piggery production project the cooperative is running with funding from Comsip Union Cooperative Limited.