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The Work of Trust Groups in Uganda

By Alexandra Arch

The focus of today centered on a truly exciting concept that I was looking forward to seeing in action: Opportunity International Trust Groups — the lending of money to business people in groups.

Our bus pulls up to a bustling market mid-morning where the action, like the sun, is just beginning to heat up on the outskirts of Kampala. Navigating the tight market arterials, the group snakes through the jumbled stalls, jumping this watery crevasse and dodging that clucking chicken, making sure to keep heads up so as to avoid the freshly butchered cow carcass. The smell of charcoal wafts throughout the area as the kitchens prepare their daily offerings. Meanwhile, vendors are continuing to carefully and artistically arrange their wares — be it fruit, potatoes or plantains — in the hopes of alluring the next buyer.

We arrive at our destination. Taking a seat in a small, dusty room on diminutive wooden benches with our legs pressed against our neighbors, we introduce ourselves to the people seated there. Then we begin to observe the weekly meeting of the Bwaise Market Group, an Opportunity International Trust Group. Aided only by the sunlight filtering through the slats in the wooden wall, Mubiru Grace records the money handed to her by people coming through the doorway. Grace holds the important position of receiving and recording the money that members bring in to repay their loans. The 14 members of this Trust Group all have different businesses, but they are joined together by the group’s bond.

To explain Trust Groups as simply as possible, Opportunity International places loan officers in different areas with high business activities to garner interest and explain the organization’s loan mechanism. Through a series of informational and training events, interested business owners (or owners-to-be) must agree to co-sign loans for each other in groups of five, a subsection from a bigger group that begins to form in the same way. Essentially, it becomes a business network, a community, of people that have chosen the common goal to grow their businesses and to rely on one another for support in this endeavor.

These group members, aided by a loan officer from Opportunity International, manage themselves and vote in a board of directors. Meetings serve as a venue in which to learn business skills, such as accounting and ethics, as well as a place to air individual business concerns or problems. Trust Groups are such an interesting concept because the members have chosen to become accountable to one another, and ultimately, put themselves on the line for one another. If one person defaults on their payments, the group must cover the discrepancy and produce the overall sum.

I wish I could detail every member’s story. Take Kasifa, a friendly woman with prominent cheekbones and a lifted chin wearing a checkered apron, who buys fish wholesale and sells them smoked in the market. In her tenth loan cycle with Opportunity International, she has grown her business and hired other women to help her sell her goods, as well as used her income to educate her seven children and build a house. Restaurateur Zawedde is eager to show us her eatery located on the edge of the market, an enterprise that would likely not be possible without her loans from Opportunity International. Her current $600 loan not only helps to ensure the future of her eatery but also to help pay for one of her children’s university education. Maureen, a young (and quite savvy) newcomer to the group, has financed a water tap to be installed at the market place after recognizing the need for immediate, fresh water on location. Selling her water to market vendors, she earns almost $35 a week, which helps her support her two children. Maureen is applying for her first loan with Opportunity International in order to get into the plantain business. Jane, the Opportunity International loan officer, tells me that she is proud of her work and feels connected to the people in the group. She cares about their future successes.

The transformation of these individuals cannot be denied. Although these are folks who were always hard-working and have creative, entrepreneurial spirits, they have chosen to empower themselves by the money — the means — to achieve their goals and to invest in a sustainable future. By investing in and growing their businesses, they’re hoping to one day have built up savings to ensure their future financial independence and a protection against the unexpected.

This transformation could not happen without money, of course, but it also could not happen without the community that I have witnessed here. I think that the Trust Group idea is not only brilliant for these smaller scale loans but it’s also effective, as the track records indicate.

This notion of community is again reinforced by one last Trust Group client that I have met, named Ssalongo Ntumba. A thin, well-dressed man with a gracious demeanor, Ntumba is a single father of seven children. Ntumba, 48, transitioned from a poultry farmer to a landlord after applying for Opportunity International loans and continuing to build tenant housing. Currently managing 70 units, he enjoys a level of prosperity that not only gives him financial power for the future but also has enabled him to build a thriving community around him, full of families, animals and crops. He is, in effect, transforming his own life, his family’s life and the lives of those in his community. In the future, Ntumba plans to build a school for the local children.

It is a wonder why some folks harness opportunity and set a domino effect into motion in their lives — garnering income, investment, savings, better quality of life, education — while others do not. How exciting to nourish the process through microfinance while also empowering people and turning their choices over to them.

Read Alexandra Arch’s first blog post about her arrival in Kampala, Uganda, and her meeting the extraordinary people there.  Check back in to read her upcoming updates from Uganda.

Alexandra Arch sends us her reflections and insights from her Insight Trip in Uganda. Arch is a freelance writer based out of Bend, Ore. An avid outdoor enthusiast, she also is trying her hand at operating a farm and raising animals. The author is particularly looking forward to shopping in the African markets and floating on the Nile.

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