Many of us are thinking about inflation and changing economic tides these days, but these issues are even more pressing in vulnerable communities.
Inflation can be devastating for women experiencing poverty, especially in Nicaragua, which currently has the highest inflation rate in Central America, 11.6%. As prices continue to rise, it becomes more difficult for people to make ends meet and provide for their families. With the new school year starting in February, this is particularly evident in the cost of school uniforms and supplies.
In one of the country's largest markets, the prices for school uniforms have nearly doubled.
Public education is free in Nicaragua, but parents have to pay for uniforms, school supplies, transportation, and other expenses. These costs can be a significant concern for many low-income families. With inflation, they become even more unaffordable.
The burden of these rising costs can have a cascading effect. When kids don't have the supplies they need for school, it can negatively impact their education. Not only can it lead to lower academic performance, but some families face tough choices — there's a greater likelihood that they won't be able to send their kids to school at all. In Latin America, 40% percent of children drop out of school by age 12.
Every year, when we ask our members about their goals, one of the most common answers is that they want to support their children's education. Our community savings groups give families the opportunity of consumption smoothing — the ability to weather unexpected income changes and prices. By joining one of our groups, families can save up for necessary school supplies and celebrate important milestones, like graduation.
In 2022, 16 of our members celebrated a graduation with their children. We're honored that we can give women in Nicaragua a tool that helps them to better provide for their children and be more resilient in the face of hardships.