Photo courtesy of Nico Pascarel, via Anton Krone, SaveAct, Pietermaritzburg, South Africa
 Photo courtesy of Nico Pascarel, via Anton Krone, SaveAct, Pietermaritzburg, South Africa

VSL Associates - who we are

VSL Associates is a group of independent practitioners, working to spread the Village Savings an Loan (VSL) Savings Group (SG) model worldwide.


We want to help millions of poor people access and manage their own, basic financial services that are:

  • demonstrably useful
  • independent and self-managed
  • self-financing
  • accessible
  • transparent
  • secure
  • profitable

Why VSLAs serve the poor better than MFIs

 Whom do VSLAs serve?

Typical clients of Micro-finance Institutions (MFIs) are the owners of established small businesses, who want to borrow to increase business turnover. MFIs are mainly found in urban areas, where lending is profitable.  Their main product is credit.

But the typical villager in Africa and Asia is less interested in running a formal business that needs credit in order to expand. They are much more interested in avoiding risks associated with debt and give priority to stabilising household cash-flow though maximising savings and minimising debt.

Savings Groups (SGs), which are self-managed, sustainable, secure and highly profitable are the best way of doing this.

 How it started and current scale


There are estimated to be 2.5 billion unbanked adults worldwide, who mostly live in remote rural areas.  By the early 1990s, it was clear that, to reach these people, a new model was needed that operates sustainably at very low cost: reliably offering the right products at the right price, on the doorstep. 


Building on informal traditional models was found to be the way to achieve this, along with improved governance, standardised procedures and simple, transparent financial systems. 


Initiated by Moira Eknes in CARE's Matu Masa Dubara (Women on the Move) project in Niger in 1991, variations of this methodology now reach more than 20 million people worldwide, with about 2/3 using the VSLA SG model.



How and where do VSLAs perform?

What are VSLAs?

  • The Village Savings and Loan Association (VSLA) model creates self-managed and self-capitalised savings groups that use members' savings to lend to each other.
  • VSLAs are comprised of between 10 and 25 members and offer self-managed savings, insurance and credit services in urban slums and remote rural areas.
  • The model has spread to 75 countries in Africa, Asia and Latin America, with over 20 million active participants worldwide.
  • Spontaneous replication is taking place without the intervention of a project. On average, for each 'foundation' group in Kenya and Uganda, 2-3 years later there are 2 more groups, mostly formed by the members themselves.

Worldwide performance

  • VSLAs operate independently, without additional technical support after 12-15 months.
  • 89% of groups continue to operate more than five years after receiving training, on average doubling their capitalisation and average loan sizes.
  • 78% of the members are female
  • At any one time the average group has 63% of members with loans outstanding.
  • At any one time 74% of the available funds are in loans.
  • The average return on assets is 18% and on savings is 22%.
  • The cost per member averages $22 (and as little as $8, when delivered through a good local NGO).
  • 98% of members continue from one annual cycle to the next.

Are they here to stay?

VSLAs have transformed marginalised communities worldwide, mobilising local savings, which provide members with a means to cope with emergencies, help to manage household cash-flow, build a capital base and, crucially, re-build social networks, solidarity and trust. 

The micro-finance industry has come to accept the place of VSLAs as an important part of the financial landscape, recognising them as able to bring profitable and sustainable entry-level financial services to the rural poor, in their own communities, managed by themselves.  

Research in 5 countries over 5 years showed that 89% of VSLAs continue to operate and, on average, have doubled their capitalisation.

They are here to stay