Village Savings and Loan Associations


Women living in urban centers have access to credit through microfinance, however, rarely does microfinance extend to rural areas. Rural women need a different mechanism in order to access credit to start small businesses.

Women’s Worth, Inc. is currently working to establish Village Savings and Loan Associations (VSLA) in rural communities in Nicaragua. VSLA are savings and lending groups managed entirely by its members.

VSLAs have many advantages over traditional microfinance. The average interest rate for microfinance loans is 37%. VSLAs establish their own interest rates based on the payment capacities of its members. Moreover, interest payments and fees contribute to the growth of the savings of the group’s members.

VSLAs provide a method for regular savings and the growth of these savings whereas national laws prohibit traditional microfinance from taking deposits. VSLAs can also respond to fluctuations in the income of their members and can elect to suspend contributions during harvest and lean times. VSLAs can continue to operate in conflict areas or can easily re-establish themselves after a period of conflict.


Since VSLA’s are self-managed by the group, the women in the group are empowered not only by receiving economic assistance but by contributing, administering, and lending. The members are agents of their own economic independence.

Women’s Worth provides the guidance to establish these groups in rural areas. It takes approximately eight months to guide a group through the establishment and management of a VSLA. CARE International estimates that approximately 96% of VSLAs are fully self-sufficient within two years.