A chief in Malawi’s Chiradzulu district has expressed worry over the increase of disputes from village savings groups in his court.
In an interview with Malawi24, Traditional Authority Ntchema of the district explained that he usually receives cases of people who default on loans and members who run way with groups’ money.
He added that this is leading to seizure of people’s property including houses and land if ones fail to honour agreements, a development which he says leaves the victims in poverty.
“Those who are failing to pay back the money are losing their belongings because fellow members from the group come and take away properties equivalent to the money owed,” he said.
He described lack of good business management and dishonesty of group members as main factors contributing to the increase in these cases.
Ntchema, however, noted that the initiatives are also good since they lend a hand in uplifting the economic status of villagers in his area.
He asked other stakeholders including government and Non-Governmental Organizations (NGOs) to help eradicate the problem by providing the communities with skills and education on how they can use the money for their benefit.
“This is a good initiative because it helps many people to have a chance of lending money and start small businesses and be able to support their families.
“These village banks have brought the remarkable developments in my area, for example, others started businesses with loans from these groups and have managed to build good houses, educate their children, and many other developments that transform them,” he said.
Village savings group are one of the means advocated and supported by government and organizations which are used to empower communities economically.