Partner: Barry Callebaut-Nyonkopa Cocoa Buying Limited
Year: 2024
Category: Community Development
Project Summary:
The Village Savings and Loans Association (VSLA) Categorization Assessment was launched to assess the operational and financial performance of 660 VSLA groups on Barry Callebaut-Nyonkopa Cocoa Buying Limited’s cocoa supply chain in Ghana. Launched between 2022 and 2023, they aim to increase financial inclusion among cocoa farmers, empower marginalized groups, and drive community-led financial services. VSLAs provide a platform for members to save money, lend to one another, take out loans, and engage in Income-Generating Activities (IGAs). Building these groups’ ability and digitizing their operations is essential to the program’s goal of empowering them financially, improving their financial management, and making them more sustainable.
The assessment was conducted in five regions and across ten sectors, focusing on profiling and categorizing VSLA groups by governance structures, financial health, and performance.
The results, with their potential to shape the future of VSLAs, will help Nyonkopa meet the needs of the VSLAs and develop inputs for future support and interventions.
Some of the key findings of the study include:
- Variations were observed across the Savings and Share values of groups in the assessment.
- Loan distribution practices exist across the groups (although default rates are common in most of them).
- Almost all the VSLA groups charged interest rates ranging between 50-78% per annum.
- Most groups do not own a constitution, let alone one that all members have signed.
- The quality of record-keeping was a significant problem in almost all the groups, where delays, misplacement and falsification in financial reports were found to slow down the progress of the group.