Pathway 1 - Financial resources

This pathway aims to have an impact on all vulnerable women. In many cases, poverty is a driving factor of other forms of vulnerability, as it limits access to services, one’s position in society, etc. There is thus a need for all groups of vulnerable women to benefit from an improved economic situation.

However, many of the actual and potential activities in this area focus on enterprise and small business development. It is important to recognize that not everyone is or wants to be an entrepreneur, and thus some of CARE’s work in this pathway focuses more on women with the skills, energy, ambition and appetite for risk to start and develop their own businesses. If successful, these businesses provide employment opportunities across the community, including for other vulnerable women.

• The Ministry of Gender and Family Promotion, providing the political framework to work on gender issues, including equitable access to economic opportunities and resources.
• The Ministry of Finance and Economic Planning, being the main ministry elaborating and managing policies and strategies that affect the pathway.
• The Ministry of Trade and Industry, including its Rwanda Cooperative Agency which provides capacity building to cooperatives. VSL members who set up cooperatives can benefit from this to improve their economic situation.
• The National Bank of Rwanda (BNR), which oversees all micro-finance institutions (MFIs) and banks, and gives input to others on how to work with MFIs. Their policies also affect the pathway.
• AMIR, a national network of MFIs, which is focused on capacity building and advocacy for the MFI sector, and ensuring liaison between MFIs.

CARE Rwanda’s work on this pathway is informed by the Government of Rwanda’s policy context. Of specific importance to this pathway are:

• The Microfinance Sector Policy (MINECOFIN, 2007) identifies standards for MFI services and the political framework that regulates informal VSL groups.
• The National Financial Education Strategy (MINECOFIN, under development) identifies needs for financial skills for different population segments, depending on the type of their economic activity. It provides the basis of CARE Rwanda’s financial literacy program.
• The Women and Youth Access to Finance Program (MIGEPROF, 2012) aims at building capacity of women and youth to access formal financial services and encouraging these services to provide credit to women and youth.
• The Cooperative Law (MINICOM & MINECOFIN, 2007) includes the rules and regulations around the establishment and functioning of cooperatives.
• The Small and Medium Enterprises (SMEs) Development Policy (MINICOM, 2010) has as its mission “to stimulate growth of sustainable SMEs through enhanced business support service provision, access to finance and the creation of a conducive legal and institutional framework.”
• The National Social Protection Policy (MINALOC, 2005) includes the U-SACCOs which are important institutions in linking VSL groups to MFIs.

In order to achieve change in the economic situation of VW, CARE Rwanda and its partners use a combination of well-tested models and innovative approaches, including the following:

• Village Savings and Loans (VSL) model. The VSL methodology involves the voluntary formation of groups of 20-30 selfselected participants who make regular savings contributions into a loan fund, from which any of the members can borrow.  Loans are paid back with interest, causing the fund to grow.
• Financial Literacy. In order to enhance the efficiency of the VSL methodology, CARE Rwanda builds the financial literacy of VSL members. This gives them basic skills related to earning, spending, budgeting, saving, and borrowing.
• Access to Financial Services. Access to financial services (including saving, credit, insurance, etc.) is a critical enabling condition for pro-poor economic growth and improved livelihoods for poor people.
• Set up and management of small-scale enterprises. To enable VSL members to invest their loans or savings efficiently, CARE Rwanda and its partners help them in identifying viable business opportunities and build their capacity in managing their enterprise.

The following indicators are used to measure impact at the level of this pathway:

• % of adults who are financially served (sex disaggregated).
• % households that do not rely solely on agriculture for their livelihood (comparing households with vulnerable women with the district average).

• Between 2006 and 2012, CARE Rwanda and its partners facilitated the set-up of 8,160 VSL groups, with a total of 241,523 members, 78% women.
• The VSL methodology aims at targeting especially the (very) poor within a community. It uses communitry consultation and basic poverty profiling based on the government’s poverty characterizations in order to select potential participants.
• Testimonies from participants and other community members illustrate the impact brought about by VSL groups: Mukabahizi Domitilla joined a VSL group in April 2010. With her first loan of 5000Rwf (around 7.40USD) she reinforced her business of beans, her usual business.

• ISARO (Kinyarwanda for ‘pearl’)
• Sustainable Access to Financial Services for Investment (SAFI)
• Community-Assisted Access to Sustainable Energy (CASE)
• VSL Rulindo
• Solar Lamp Project
• Rwanda Integrated Water Security Program (RIWSP)
• WPower (Promoting women’s entrepreneurship in renewable energy)
• PPA4 (Financial Education and linkages to private sector)
• Women’s Enterprise Promotion

CARE Rwanda is committed to learning to continuously improve the relevance and quality of its work. In relation to this pathway, it poses itself the following questions:

1. How can the outcomes of the Gender Gap Analysis further be integrated in initiatives promoting women’s economic empowerment?
2. What are the barriers to women starting and growing successful businesses?
3. How can VSL support complement social safety net programs for the very poor, such as VUP?