Transitioning from Savings Groups to Cooperative

The third consolidation session last September 25 ended with a decision to move towards formal registration. Among the reasons for the consolidation and formalization are the need to mobilize for larger amount of resources and the installation of operating systems that will facilitate more efficient operations. Partnership with other funding agencies who will provide matching funds will also require a juridical personality for the groups.

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Savings group leaders expressing their opinions during the small group session

Leaders expressed their opinions about the proposal and its impact on their savings group, existing savings mobilization activities and the enterprises envisioned increasing income of the members. The participants agreed to proceed with the consolidation into a cooperative. A representative from each of the 33 villages was selected to form the core group that will work on the formal registration.

IMG_5595CDA Village Mobilizer Naw Win Win Hsu facilitating discussions on the consolidation of savings groups

With the move towards formalization, there will be a clear definition of roles between the savings groups and the cooperative. On the one hand, savings groups will provide provident loans to address urgent needs like hospitalization and immediate cash needs. On the other hand, the cooperative will provide for income-generating and production-related needs of the members like capital for agricultural production or enterprises which entail bigger amount.

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Leaders continue to discuss the issues in small groups while on break

The formal registration into a cooperative is the final stage for the institutional development component of the project. It is envisioned to be a model of a sustainable community-based financial institution that will provide financial access to rural individuals who are financially excluded and without access to any source of capital.

As of September 25, there were 99 savings group formed with 1,077 members mobilizing US$34,110. savings. The table below show the increase in the number of members and savings mobilized since the project started the organizing work in April 2015.

Period                    Village                    Participants              Number                 Number              Amount                                                                          to RSMT       of Savings Group         of members       of savings

April-June 2015             30                             1,081                        60                           545                     NA
July 2015                        33                                –                             83                          807               US$14,500.
August 2015                  33                             1,401                        88                          858               US$21,182.
September 2015           33                             1,565                        99                       1,077               US$34,110.

Members joining the cooperative will pay for the share capital that will be determined later. The amount will come either from their existing savings with the group or direct out-of-pocket payment. Other than the share capital, members can avail of deposit services that will be provided by the cooperative.

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