Village Community Banks -VICOBAs

At WEECE, a village Community Bank is a group of women who come together to mutually support each other by pooling assets creating economic stability to all members of the VICOBA. This group is usually about 30 women who live in the same area.

Every month each member of the community will deposit money into a shared account, this amount varies by the capital available to the members and ranges from $4 - $25 a month. Within a VICOBA, the members split into “magnet” groups of 5 members, each magnet group can give a short-term loan to one of its members at 10% interest paid upfront (usually repayment is done over less than 4 months). Every member of the magnet group acts as guarantor to the loan, therefore, trust within a magnet group is essential.

 

After one year, every loan must be repaid, and the community bank account is dissolved. Every deposit is returned to the members and the capital from paid interest throughout the year is distributed among the VICOBA with the members who paid the most interest receiving the highest share. The annual cycle will then begin again, hopefully after a year every member should have higher purchasing power and so the VICBA can consider increasing the monthly contributions. As such, year by year, the community will grow emancipating its members.

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Every VICOBA must have monthly meetings, to share out loans, repay old ones, discuss plans for new businesses or investment opportunities. This allows the members of the VICOBA to create a financial network amongst them but also creates a social bond between them, strengthening their trust and thus their willingness to loan to each other. It is common for members in a group to support each other’s businesses by buying their products or making use of their services.

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WEECE founded the first VICOBA group in the region in the early 2000s. Since then, 15 groups have started and are still operating to this day in the Kilimanjaro region. This means that over 400 women have found economic stability and have started the process towards financial independence. These groups are fully autonomous, allowing the women to be directly responsible for their own empowerment. WEECE only serves as an overseer or an arbiter when required. We also offer consulting to members of our VICOBAs who are in need, either as a one-time meeting to discuss an investment opportunity or by helping them designing a project over several weeks.