Socio-economic impact of village banks on women entrepreneurs

Safe help groups known as village banks have risen in prominence across the world and in Malawi. This study analyzed factors influencing women entrepreneurs in village banks in Malawi. The study was conducted in low-income, high-density populated areas in the district of Blantyre, Malawi. It was guided by the village bank group model. Four focus group discussions and eight key informant interviews were conducted with participants that were purposely sampled from the targeted population of village banks in Blantyre. Data were manually analyzed using thematic content analysis. Four themes emerged from the study: group social support, group unity, financing opportunities and village banks operational challenges. Financing opportunities significantly influenced women's participation in village banks, resulting in sustainable entrepreneurial activities for them. In addition, social support in times of sickness or bereavement unified the groups and through prescribed group norms of identity through names and group identity regalia had aided the groups to operate for a long time. However, operational challenges impede the activities of village banks, and issues such as poor record keeping, financial illiteracy and nonexistence interactions between these groups and financial institutions limit the growth of such groups' impact. Through the government and non-governmental organizations, efforts can be put in place to provide financial management training to these groups so that the participants’ economic footprint increases significantly. There is also a need to have policies in place to enable groups interact with financial institutions. Government should also develop and maintain village bank group records that will also aid in tracking them for taxation purposes.