Payday in Guachupita:
What a VSLA Payout Looks Like
Written by Taylor Pizzuto on September 6, 2016 in General
At Plant With Purpose we love to celebrate the success of Village Savings and Loan Associations (VSLA). In rural areas, where access to affordable loans and bank accounts is limited or even nonexistent, community members are joining together through VSLAs to build savings and borrow affordable loans to accomplish their dreams. So when we hear about families beating the odds and overcoming rural poverty, naturally we’re excited to celebrate. And naturally we’re excited to share.
In the community of Guachupita, the members of the “Camino del Luz” Village Savings and Loan Association (translation: Path of Light) have just completed their first year-long savings cycle. For an entire year, group members have met weekly to lend, borrow, and repay affordable loans among one another. In doing so, many have put a large amount of their family’s income and livelihood on the line to invest in their dreams.
After enduring that first year, a year of uncertainty, patience, and faith, the day has come for members of Camino del Luz to witness the culmination of all their savings and training. It’s payday.
The meeting takes place at a nearby home about a quarter mile or half kilometer from town. In front of the home, tucked among the trees, stands a structure with a tin roof and blue plastic tarps fastened atop logs and rough-cut lumber. Several linen cloths draped together act as a backdrop of green, white, yellow, orange, and red between the structure and the house. Balloons hang from the ceiling.
As 11:00 a.m. approaches several group members are still arriving down the dirt path leading from town, but most are already seated in plastic chairs under the shade. Most of these group members are women, including the majority of their self-elected leaders who hover above a table, counting and recounting stacks of colorful Domincan Pesos. The members watch, whispering excitedly to one another. Everything is in order for the meeting to begin promptly on the hour.
The stacks of counted pesos will be distributed based on the purchased shares and collected interest of all 39 members of Luz del Camino. Originally, one share cost RD$50 (about $1 USD). After the year’s interest, that share is now worth RD$62.08 (about $1.35 USD). Many members have purchased around 300 shares.
Antony, Plant With Purpose’s economic coordinator for the region (pictured above), and the staff member responsible for training and guiding the group, opens the meeting in prayer. He follows by explaining the process, touching on the importance of discipline and responsibility that led the group from its formation to today’s celebration. He then invites other members to share their experience and opinion.
An older man jumps to his feet (pictured above).Rafael de Jesus is 64 years old. “I see this group as a great opportunity. Before this group I used my money for cigarettes, lottery tickets, and my coffee plants. But then this group formed. A group in our own community, with our own name, and our own leadership,” he says excitedly. “I’m so grateful to God to participate in this group. Now, I don’t buy lottery tickets. I’m smoking less. And I have more money to purchase coffee!” Everyone laughs and applauds.
“I was able to take out a loan to repair the roof on my family’s home,” one of the group’s accountants shares with pride.
A younger woman stands and timidly mentions, “I received help from the group’s social fund to help pay for an operation for my mother.”
“The majority of us didn’t have a good experience economically before this group,” says the group coordinator. “We didn’t have much confidence in loans and savings.”
One last woman steps forward. Her name is Luz, and she does not belong to this VSLA group. Instead she comes from the nearby community of La Rosa, where she experienced her own success through VSLA. Feeling a personal debt of gratitude to God and Plant With Purpose, Luz felt called to promote the VSLA program to other nearby communities, including here in Guachupita.
“This first year went perfectly,” says Luz regarding this hesitancy that accompanies a new savings group. “And I thank God that you have accepted this idea and were able to take out loans and carry out your goals.” The group responds with applause. “The greatest benefit of this group is being able to meet. This shade is an example. Everyone came together to purchase and construct the metal and wood for this meeting place.” As Luz points around the structure where the group is seated this closeness and unity is clearly visible, and nearly tangible.
With Antony’s suggestion, the process of distributing money begins. The group’s registrar calls up each individual member, one by one, to collect her or his respective amount.
“Estebania!” A woman in an ironed pink tank shirt and spotless white pants hops up and strides to the table (pictured above). She stands eagerly before the accountants, bouncing on her heels as they count and record the money. Finally, the money crosses over the table. With a wide grin Estebania collects her stack of bills, turns around and shows it off to the group. Someone seated in the group yells, “un aplauso para Estebania!” and the entire group erupts in clapping and cheering.
Estebania poses for a photo, jokingly fanning herself with her collection of Dominican pesos. This stack of bills represents the interest collected from a loan she borrowed to repair the roof of her colmado, her convenience store and her source of income. A sarcastic remark is made, and everyone laughs as she returns to her seat. Nevertheless, in this moment she beams with pride; she is untouchable.
This continues for all 39 members. Through the long process, the members strike up side conversations, share snacks, pass a newborn baby to be cared for and adored. But when the time comes for another member to receive their payment, everyone stops and offers applause equal in volume and admiration. Everyone applauds for the money they’ve earned together, the dreams they’ve begun to achieve, and the unity they’ve strengthened.
Finally the last member, Altagracia, is called up to receive her payment. After her applause dies down, she remains at the front to thank her fellow members. “I’ve loved participating in this group with everyone this past year. May God bless the years to come. Gracias!” Another applause erupts as she returns to her seat. A huge smile on her face.
But perhaps the most crucial moment of the day has arrived: lunch is served. Everyone enjoys a collective meal of chicken, rice, beans, and salad. And of course, the meal will end with dessert: reading from the Bible and prayer. Antony stands before the group and reads Proverbs 30: 24-28.
“Four things on earth are small, yet they are extremely wise: Ants are creatures of little strength, yet they store up their food in the summer; hyraxes are creatures of little power, yet they make their home in the rocks; locusts have no king, yet they advance together in formation; a lizard can be caught easily, yet it is found even in kings’ palaces.”
“The point of VSLA is to grow,” he adds, “in equity and in membership. But also in unity. With the strength of this group, when you support and believe in one another, you can come together to achieve your goals. Today is an example of that.”
With another round of applause Antony asks if anyone would like to close in prayer. Altagracia again rises. “I thank God that each day we have grown closer in unity. We are a community, neighbors, a family. I ask that we may always remain together. Today, tomorrow, and always.”
This celebration in the community of Guachupita is just an example of the success that occurs through the model of VSLA. Savings groups around the world, just like Luz del Camino, are uniting to provide loans, accrue interest, and build a financial safety net together. For all the communities completing their first cycle of VSLA, congratulations. Here’s to the success of year number two, and beyond!