| dc.description.abstract | Formal microfinance institutions have been regarded an important tool in the fight against
poverty in developing countries. Following this, Village Savings and Loan Associations
(VSLAs) have emerged as one of the most popular informal mechanisms for mobilizing
saving and extending credit to the poor in developing countries. Thus, this study aimed to
assess the effects of VSLA on poverty reduction, taking a case study of Aluru Parish, Moyo
District, Uganda. Using a mixed qualitative and quantitative research methodology, the
study tried to focus on examining the effects of VSLAs contribution to economic and social
wellbeing of households, and decision making, and participation in community activities.
The study used 254 samples (127 VSLA participants, and 127 non-participants) and
collected data using questionnaire and focus group discussion.
The study used propensity score matching (PSM) to estimate the effect of participation in
VSLA on average monthly household income, and the result indicated the average effect of
participation in VSLA on average monthly household income of participant women is
positive and significant at 5% significant level, ranging from 21,416.55 UGX/month (nearest
neighbor matching) to 17871.33 UGX/month (Kernel matching), on average. Besides,
comparison between participants and non-participants using hypothesis testing shows that
participation in VSLA has a significant positive association with improvements in household
diet, health, children’s education, and involvement in household decisions. However,
although hypothesized, no significant association is found in relation to participation in
community activities. Findings from the focus group discussions are also consistent with the
results from the PSM and hypothesis testing. Following the findings, the study recommends
government and nongovernmental organizations to provide regular, timely and need based
capacity building trainings for VSLA participants; Link VSLA participants with formal
microfinance institutions; conduct regular monitoring and follow ups by either the District or
concerned government body; different concerned stakeholders in the District including
government, nongovernmental organizations, microfinance institutions and others need to
work in coordinated manner to solve the recurrent challenges of VSLA participants in Moyo;
and finally government and/or nongovernmental organizations need to take best practices
and lessons from existing VSLAs and expand the VSLA initiative to address more
impoverished households in the District. | en_US |
