Digital Savings Groups
Savings groups play an important role for individuals who lack options to save large amounts of money or have limited to no options to borrow. AKF designed and built a specialized platform aimed at enabling savings groups in Southern Tanzania to operate digitally with the help of Tanzanian payment aggregator, Selcom. The platform allows group members to save, request loans, make loan payments to the group and receive loans and share-outs through mobile money. It eliminates the need for physical lockboxes to store cash, improving the safety of funds thereby addressing one of the biggest concerns related to traditional group operations. AKF, with the technical assistance of BFA Global, ran a randomized control trial to determine whether digitized savings groups helped women cross the digital divide. The study found that savings group digitization improved the perception of the safety of funds and resulted in measurable time savings, which were appreciated by group members. Digital learning and improved attitudes towards digital financial services were an added benefit.