Savings Mobilisation to Microfinance: A Historical Perspective on the Zimbabwe Savings Development Movement

This paper aims to understand the historical development of the savings movement in Zimbabwe and highlights the factors that prompted the Self-Help Development Foundation (SHDF) to implement its own microcredit scheme after decades of savings mobilization.

The paper traces the origins and development of the SHDF:

• The beginning of the savings development movement;
• The post-independence period;
• The structural adjustment program, donors and microfinance.

It analyzes the impact of the introduction of micro-credit:

• On SHDF:
  • Clarification of vision and mission;
  • Integration of savings and credit into one microfinance institution (MFI) entity.
• On savings clubs:
  • No impact on savings;
  • Diversion of loan funds purposes other than the original purpose;
  • Decrease in informal lending.

The paper concludes that:

• Prior to the emergence of the savings movement, colonized Africans had already developed certain forms of savings organizations;
• Savings development movement was developed from the early 1960s as an attempt to harness community self-help activities;
• Introduction of credit has forced SHDF to clarify its vision and mission, separating its "financial" and "educational" objectives;
• The program apparently increases differentiation between savers and borrowers, and also between "good" borrowers and "bad" borrowers;
• The program divides the clubs on the basis of savers and borrowers, old and new members, successful and unsuccessful entrepreneurs.