byDaniel Tesfu M&E and Communications Coord. via web
In Osele sub watershed of Boset Woreda (Oromia Region, Ethiopia) most of the farmers own less than 1.5 hectares of land and rain-fed subsistence farming is the main source of livelihoods. More than 30% of the population is food insecure and is the recipients of safety net programs. Income diversification opportunities are very limited and no financial service such as micro credit is available in the area.
In such a backdrop, DryDev trained a group of young men and women in December 2015 to form a village savings and loan association (VSLA) and save to make finances available for income generating activities. These young people formed two saving groups (Abedi Boru and Biftu Bori) including both young men and women and started saving. ‘We were used to spend everything that we would have, prior to receiving this training’ the young leader of the Abedi Boru VSLA said. ‘Now we save even on our mobile phone recharge’. They would earn by doing paid farm labour to contribute to savings group. From the first share out, some of them bought lambs and sold them after two to three months, earning a profit of 200-300 Birr per animal. Others invested in poultry and everyone is reinvesting their earning and at the same time, increasing the investment by saving with the group and taking loans. Service charges are minimal and everyone can afford a loan and repay. By now, all the members have taken at least one loan from the VSLA and they also have a social fund of 2582 birr that they use to help members in emergencies. The two groups have a balance of nearly 10,000 birr (USD500). They have been encouraging other young people in the area to form their own VSLAs and the numbers of VSLAs in the Kabele have reached to 18 with an average membership of 25.
While started with very small amount, these young people are consistent and their capital is growing. They are an example for other young people in the area. Some of them want to be a model farmer while others wish to start a business of animal fattening. They can now see a future for themselves in the area and don’t feel the need to go to town, looking for work.