CrediCapaz - A Savings Project

One of my team´s projects for our 4 weeks is helping SolCom with one of their (very) new initiatives, called CrediCapaz. Basically all that exists now is a name and the desired outcomes of the project. So each team is charged with doing market research, surveys, and formulating a potential plan that we´ll eventually present for review. CrediCapaz is aimed at encouraging good savings habits among poorer Guatemalans by setting up community savings-based ¨banks¨.

Savings really can have a lot of good repercussions for the poor - they can use their savings as a buffer for unexpected things, or save for larger planned investments. Also, its a lot easier and better to make an investment out of your savings than to take out a high-interest microfinance loan (some go up to mid 30s% interest).

So far my team has done a lot of research into existing financial options for Guatemalans in different areas and surveying into the current savings patterns. My friend Chris and I walked around Nebaj and talked with owners of cooperatives and banks to see what sort of rates they offer and incentives and disincentives for using each type. I thought that was really interesting - a good opportunity to use my Spanish and talk directly to the administration of those places. We also developed a survey for regular people to ask about their savings - we´ve found so far that people are interested in savings, often don´t have enough money to do so, and generally distrust banks (apparently they fail w/o warning!).

The rest of this might be somewhat technical? I don´t know. It´s interesting.

Our plan is based on an existing structure in Guatemalan society - the cuchubal, which the word for a ROSCA. A ROSCA is really not complicated at all - basically a group of people that contribute a fixed amount each month (or a set term), and one member of the group takes all the money each month. It could kind of be looked as a 0% interest loan. Read the Wiki for more detail.

Our plan modifies the ROSCA´s shortcomings, which are lack of savings interest and unknown withdrawal time. We are trying to modify it so people can plan their withdrawal time, so they can plan investment, and also offer initial interest (from SolCom, via an Asesora) to entice people to join. I won´t go into all the details here because it would take awhile, but it´s really interesting to go to the grassroots level when designing a project like this, and seeing what people really want, what they would actually take advantage of, what incentives they need, etc. It´s also good for practicing Spanish!