Benefits and challenges of village savings and loan associations on single-headed families in Wakiso District, A case study of Kasangati Town Council

Abstract

Village Loan and Savings Associations are small groups of people in an area who decide to save their money for the purposes of simple saving, investment and or enhancing financial services and local levels. This study was therefore designed to establish the benefits and challenges of village savings and loan associations on single-headed families in Wakiso District taking a specific case study of Kasangati Town Council. A mixed designs research design which refers to a research design popular in the social, behavioral and health sciences, in which researchers collect, analyze, and integrate both quantitative and qualitative data in single study The major findings of the study included: The VSLA contributed to social benefits including social status improvement, addressing emergencies and creating awareness was a success, while this wasn’t the case on access to justices. The economic contributions of VSLAs were appreciated and they included: increase of income of a household head, improved the culture of saving, the culture of investments like in agriculture, assets among others, and supported the household expenditures though acquisition of savings and acquisition of household assets like furniture and electronics. While this was the case, the issue of financial literacy besides the positive response, the magnitude of the negative response to provision of financial literacy was high (above 40%). This implies that there was limited financial literacy among members. The management was faced with a few challenges which included loan defaulters, dominancy in decisions and idea contribution by the leaders and favoritism in giving out loans. Besides the information flow was highly appreciated and safe box protection was also a key success achieved.