The community banking project in Muhondo Parish has been in operation for two years now. It is unique in the fact that it combines the concept of a community run bank to encourage indivdual savings and make small microfinance loans , along with education and vocational training ,as well as, psychological support and ethinic reconciliation
The 1994 genocide in Rwanda left much suffering, poverty and social disruption. These realities created despair and the lowest ranks of society, saw no way to extract themselves from their situation. With something as simple as community backed savings and loan program, people were convinced to save a few cents a month and receive credit to rebuild their lives
Father Pascal Tuyisenge came to Muhondo in 2008. Munhodo is, a parish of 20,000 people located in the rugged mountains north of Kigali. He was struck by the poverty and lack of opportunity in this rural area especially for widows and female headed households. He quickly understood that and economic development program could not take place in the absence of reconciliation, psychological healing and education opportunities. From there he created a plan to implement both programs to provide psychological support, mediation of conflicts and job training along with the founding of a community based credit union that would serve all members of the community equally.
People were first taught the importance of saving a small monthly sum to build their futures. Community based educational training sessions were developed along with group reconcilition meeting and psychologic support. Once a savings base had been established, with people earning 8% interest, a credit and loan phase was introduced to allow people to take small loans at 14% to start businesses, plant crop and improve their lives. Community commitees now oversee loan applications and repayment. From a humble start , the program expects to see 15,000 in savings in 2010 and to make numerous loans 50-100$. This is live changing in an area where people earn less than 1$ a day.
watch our video to see the changes the community savings program is bringing to the Muhondo area