Influence of Village Savings and Loan Associations (VSLA) on Poor Household Wellbeing in Ayamelum Local Government Area, Anambra State. (2015- 2019)

Abstract

This research work investigated the influence of Village Savings and Loan Associations (VSLA) on poor household wellbeing in Ayamelum LGA, Anambra State (2015 – 2019).  Due to short comings in the micro finance institution, a big gap has been created in the rural areas in terms of household’s financial wellbeing due to; lack of information, high interest rates, lack of collateral to take loans, access to financial facilities. Hence the prevalence of Village Savings and Loan Associations (VSLA), which is a group of people who save together and take small loans from those savings Groups, meeting weekly and members save through the purchase of shares. The researcher adopted a descriptive survey research method. The stratified and simple random sampling technique was used by the researcher to divide the population of 1,075 member of VSLA into two gender based groups and to pick individual respondents. Taro Yamani formula was used to derive a sample size of 292. Both Descriptive and inferential statistics were employed in achieving the objectives of the study. The findings of the study revealed that VSLA promotes access to finance among its members; the loan received from VSLA is used for income generation activities including rice and okro farming (44.86%); petit commerce (16.78%); and Kiosk (15.41%). Other economic activities run are: Rental Business (6.17%); bar (3.42) Okada (3.09%); and transport livestock activities (10.27%). The findings also revealed that participation in the VSLA has an overall positive effect on various indicators of individual and household welfare: that is, on investment level in assets, income generating activities (IGAs), education expenses, access to health services, nutritional diet and quality of housing and life.   It was recommended that NGOs and donors should support the creation of new VSLAs and/ or existing VSLAs so that they can increase their capital.