Caritas Lesotho has been engaged in the Savings and Internal Lending Communities (SILC) projects since 2009. The SILC model is based on the premise that individuals undergo through a self-screening process to form their SILC groups. Once established, the groups develop a constitution that guides their operations. The members pool their own money as savings and the money is lend among members which is paid with interest in order to make profit.
The household engaged in the savings & internal lending communities groups access loans from the group to meet their household needs such as purchase of food, clothing, and payment of school needs. During the year 2014/15, Caritas Lesotho facilitated formation of 397 SILC groups comprising 6749 (5939 females and 810 males) members across various project areas in Lesotho. A total of 160 members have accessed loans from the groups as capital to kick- start or expand small businesses. The businesses included shops that sell fruits and vegetables, general dealers, groceries store, catering, boutiques, poultry, printing shops, piggery and dress making.
One of the beneficiaries based at Ha Thetsane in Maseru had been struggling to access credit to finance her business. As a result she was often forced to stop production due to lack of inputs. However, with the introduction of SILC, she used her SILC group as her personal bank to save and lend money to finance her business. She used the loans accessed from the group to buy material in large quantities and to pay for the maintenance of her sewing machines. Through this practice she was able to accumulate the funds raised while also financing her loan. Her monthly earnings increased to M3, 500.00 (approximately US$290). She is now a fully licensed trader registered with the Ministry of Trade and the Lesotho Revenue Authority. “The SILC group helps me to access loans which are very crucial to my business.” she pointed out.
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