A community group in Mabvuku–Tafara is transforming small monthly savings into housing opportunities through a grassroots loan scheme that allows residents to fund one another’s building projects. Run under the Federation network, the initiative brings together 242 members who each contribute at least one US dollar a month into a revolving community fund. In an interview with 263chat, Agnes Hondo, one of the organiserssaid the project dates back to 1998 and is built on a simple idea: collective savings.
“Sometimes we expect everyone to contribute but others may fail, so the total can be around US$170,” she said. The Mabvuku–Tafara group pools its funds with other communities in Harare including Hatcliffe, Budiriro and Dzivaresekwa during regional meetings held at the Crowborough office increasing the amount available for loans. Members who contribute regularly can apply for small loans which are discussed and approved collectively before being released.
Borrowers are given six months to repay, with a modest two percent interest, allowing the fund to keep circulating. “Borrowing doesn’t go to just anyone mostly it goes to those who also contribute to the $1 scheme. When one person returns the money, it allows the next member to borrow because we take turns.” Hondo said.
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The scheme operates without external funding relying instead on trust, signed agreements and community accountability. Late repayments attract an extra charge to encourage compliance.
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