Savings Group- Save a Little, Save a Lot -

Asia/Pacific Cultural Centre for UNESCO (ACCU)

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Kamala: What happened, Maya? Why are you crying?

Maya: Well, my son is sick. He has a strange rash on

his body, and a high fever. What should I do?

My neighbours advised me to send him to

hospital. But I don’t have enough money.

Do you think I should borrow some from

the money lender?

Kamala: Oh, don’t do that, Maya! It’s too risky!

The interest he will charge you will be

incredible! He can ruin your family’s lives.

I have some savings. I can help you this time.

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Maya: But how did you manage to save money?

I thought you were as poor as I am.

Kamala: Oh, actually, it’s because of the savings group!

Do you want to know what a savings group is?

Let’s learn about a savings group!

Two days later...

Maya: Hello, Kamala! Thanks for the money, my son

was able to see a doctor. I was so worried.

My friend lost her daughter because she could not

buy medicine for her.

Kamala: It’s always important to save some money for

emergencies.

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It’s like a drop of water ina bucket.You can’t do anything witha drop of water, but onceit accumulates, you cando many things: washyour face, use it forcooking, and drink it.

A savings group is a group you can form with yourneighbours and friends to solve financial problems bysaving small sums of money together.

What is a Savings Group?

“Each and every drop fills the pitcher”“Unity is strength!”

It’s the same with money. Let’s each save a little bitand put it together!

A little bit of money from everybody will graduallymake a lot of money for the group to do many things.

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1. At the group level

In a savings group, you will always have access to cash foremergencies at very low interest or none at all.

When you need a large sum of money for starting your ownbusiness or sending your kids to school, you can ask thesavings group for a loan.

How can the Savings Group benefit me?

2. In the community

You and your group members might want to consider a savingsgroup as a starting point for improving your lives.It is a good idea to use the money for the benefit of thecommunity, say, digging a well for the village.

Use the savings group meeting as an opportunity to discussimportant issues in your lives.

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How can I save money

at home?

Make up your mind to do it!Try saving by cutting unnecessaryexpenses.Where there is a will, there is a way.

You don’t have any money to save?Think about the bad habits that you andyour family have.

Why don't you save 3 apees* a day?Yes, it’s not much, but if you do it every day,it comes to 90 apees a month!

*“Apee” is an imaginary invented currency unit.

You can save small changefrom your income as well!

Cigarettes, alcohol, gambling...Stop these bad habits, and save money!

Prepare a small bottle or a box.Save money in it every day.

Kamala,the savingsgroup seemsvery interesting.How can I savemoney at home?

Each andevery dropfills thepitcher!Remember?

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If your group faces any difficulty, seek outside advice from those with experience.For example, community learning centres and non-governmental organizations.

How Can We Form a Savings Group?

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Make a grouptogether with 5to 10 trustworthypeople.

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Decide who is tobe the leader andwho will be therecord keeper.

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Make rules foryour savingsgroup with yourgroup members.Make sureeveryone agreeswith the rules.

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Every member will hand inthe same amount to theleader for group savings.The record keeper writesdown the money flow ina group ledger. A reportshould be made regularly.

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Group members gettogether regularlyand discuss theirproblems together.

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When the moneymounts up, groupmembers can takeloans from thesavings, or the groupcan deposit some ofthe money in a bank.

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Forming a Savings Group - Note 1

Choosing a Leader and

a Record Keeper

The Leader needs to...• Be trustworthy• Be decisive• Know how to read, write,

and calculate• Have a safe place at

home to keep the groupsavings

• Have enough spare timeto manage group savings

The Record Keeper needs to ...• Be trustworthy• Be good at reading, writing, and

calculating

I have verylittle money.Is a savingsgroup reallysafe?

Yes!

The leader andthe record keeperare reallytrustworthy.

I collect money fromevery member regularly.I keep order in thegroup. I check what therecord keeper writes inthe group ledger.

Whenever eachmember putsmoney in thegroup savings, ortakes it out,I write it down inthe group ledger.

We need to have a good leader and a good recordkeeper to form a strong savings group. What kind ofpersons are appropriate for these positions?

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Forming a Savings Group - Note 2

Setting Rules

Rules (Sample)

1. Members should attend the meeting regularly.

2. Each member hands in 10 apees to the leader at the meeting to be held on the 1st day ofeach month.

3. If a member misses handing in the savings, the member will be fined 1 apees, which willbe added to the total.

4. If a member does not hand in the savings for more than 5 months, the member will beautomatically dismissed from the group.

5. When a member asks for money for an emergency or loans, the group discusses anddecides if it is agreeable. The member has to return the money in 5 months.

6. Loans are available to 2 persons at a time.

Rules like this will help your group to avoid conflicts. And we recommend you decide on your own group’s rulestogether.

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Forming a Savings Group - Note 3

Procedure at the Bank

Once your group has enough money in the savings, say, 1,000 apees, it mightbe wise to deposit the money in a bank. It’s not safe to keep a lot of money atan individual’s home. It could be stolen!

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Then go to a bank!There are various types of bank accounts.Ask the clerk about the differences betweenthem. Choose one.You will receive a passbook and a checkbook.Keep them at the leader’s house, where it issafe.

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The money deposited in the bank will accumulate interestaccording to the amount that you deposited.You see, interest is the money that banks give to the people whodeposit their money there.So, your group’s money will gradually increase in the bank!Isn’t it great?

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First, take the necessary steps to open the group's bank account.If you need an identification card to open the account, you’ll have torequest one from your local government or people’s representative.

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Now your group has opened an account. Your group can depositthe group's savings in the account.Of course, the group can always withdraw the money when theyneed it. Group leader and record keeper can take care of this.

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Be Happy with a Savings Group!

Maybe we can buy three carts,and let everybody in the groupuse them!

I want to buy a small cart to carrythe vegetables grown on the farmto the bazaar.

I want mydaughter tocontinue hereducation.

Solve your money problems as a group

for the benefit of yourselves, your families,

and your communities!

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Let’s think about it...

� Can you think of some people that you want to form a savings group with?

� How much do you think you can save each day? How can you do it?

� What do you want to achieve through saving money with a savings group?

Guide for Utilisation

Target: Neo-Literate learners at self-learning level

Theme: Forming and operating a savings group

Type: Motivational/Instructional

Objectives:

1) To introduce the idea of a savings group

2) To motivate learners to form a savings group

3) To encourage learners to adopt the habit of saving money every day

4) To provide learners with practical knowledge to start a savings group

5) To enhance learners’ literacy skills

Application:

1) Before distributing the booklet, discuss with learners whether they have put some money

aside for emergencies, and what they will do in an emergency if they do not have any

money.

2) Ask them what they want to do if they have some money to improve their lives.

3) Distribute the booklet to the learners and ask them to read it through.

4) Ask learners if they want to form a savings group. Discuss why or why not.

Note:

1) It is recommended to use this textbook with Micro-Credit -Things to Remember when

Borrowing Money- (AJP material 2000).

2) This booklet is a prototype version meant for local adaptation. Any organization is

welcomed to adapt this booklet with written permission from ACCU. It is encouraged to

modify the contents, reflecting local conditions such as currency, the use of and the

procedures at the bank, who to contact in case of trouble. Please contact ACCU for

further information.

ASIA/PACIFIC CULTURAL CENTRE FOR UNESCO (ACCU)

6 Fukuromachi, Shinjuku-ku, Tokyo 162-8484 Japan

e-mail: literacy@accu.or.jp URL: http://www.accu.or.jp/litdbase

This booklet is planned and produced under the Asia/Pacific Joint Production Programme for

Neo-Literates in Rural Areas (AJP) in co-operation with UNESCO Bangkok.

Illustrated by Ismail Lahri (State Resource Centre for Adult Education, M.P., Bhartiya Grameen

Mahila Sangh)

�Asia/Pacific Cultural Centre for UNESCO 2002 AJP No.59