Voluntary Savings Services: A Closer Look
Hirschland, M.
Journal: Common Interest, 2 (1)
Publication Date: 2001
Published by: CMF - Center for Micro-Finance in Nepal
Document Type: Web Publication
What are the particular challenges of offering voluntary savings services to the extreme poor?
The author introduces a study of Nepali and Bangladeshi institutions that addresses questions about voluntary savings. The study started with the assumption that:- To reach the extreme poor, services must be delivered in their communities, near their homes or near their work.
The paper describes how community-based services such as "doorstep" collection, collection at weekly meetings, savings services at small offices can pose three major challenges:- Vulnerability to fraud;
- high operating costs;
- Liquidity management.
The paper concludes that careful systems to project and manage liquidity are needed and to manage the liquidity challenges posed by voluntary savings, many institutions establish policies to help manage liquidity.
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