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INTERVIEW GUIDE

SOCIO-ECONOMIC EFFECTS OF ROSCA ON THE RURAL POOR IN BUYANJA VILLAGE KYEIZOBA SUB-COUNTY BUSHEYI DISTRICT

Dear respondent, this interview guide is intended to facilitate the study on socio economic effects of ROSCA on the rural poor in Buyanja village kyeizoba sub-county bushenyi district. The study is for academic purposes and is carried out as partial requirement for the award of a degree of bachelor in adult and community education of Kyambogo University, your input will be highly appreciated and will be handled with utmost confidentiality.

Demographic Factors

Gender

1. Male b) female

How old are you?

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What is your level of education?

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HOW ROSACs ARE STARTED AND MANAGED AMONG THE RURAL POOR IN KYEIZOBA SUB-COUNTY IN BUYANJA VILLAGE BUSHENYI DISTRICT

When was this organization started?

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What is the main purpose for starting up the ROSAC?

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How many members started ROSAC?

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How many members are there now in ROSAC?

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How does the ROSAC deal with defaulters?

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Socio-economic effects of ROSAC on the rural poor in Buyanja village Kyeizoba sub-county Bushenyi

What are some of the key benefits you have received from ROSAC?

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How has your income changed as a result of being a member of ROSAC?

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How has ROSAC changed the livelihood of community members?

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Challenges faced by ROSCA in Buyanja village?

How members who sometimes fail to pay their contributions are dealt with?

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What challenges do individual ROSAC members face?

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What challenges do ROSAC as an organization face?

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What financial training is given to the leaders or members of ROSAC?

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STRATEGIES FOR SUSTAINABILITY OF ROSAC AMONG THE RURAL POOR

What ways are members helped to overcome their challenges?

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How can the contribution of ROSAC to the members be enhanced?

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How does the community enhance the performance of ROSAC?

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CHAPTER FOUR

PRESENTATION, ANALYSIS, INTERPRETATION

OF FINDINGS

4.0 Introduction

This study sought to examine the Socio-Economic effects of ROSCAs on the rural poor in Buyanja village Kyeizoba sub county Bushenyi district, To establish how ROSCAs are started and managed by the rural poor in Buyanja Village Kyeizoba Sub County Bushenyi District, Establish the challenges faced by ROSCAs in Buyanja Village Kyeizoba Sub County Bushenyi District, To examine the social and economic effects of ROSCAs on the rural poor in Buyanja Village Kyeizoba Sub County Bushenyi District and To suggest strategies for enhancing the contribution of ROSCAs the social and economic wellbeing of the rural poor in Buyanja Village Kyeizoba Sub County Bushenyi District.

4.1 General information about respondents

Table 2:  Gender of the respondents

Source: primary data

Table 2 above shows that 66.7% of respondents were female and 33.3% were male. That means that the biggest percentages of respondents were female and apart from that it also shows that female are twice more than male. The above findings also indicates that the male usually participate in the ROSAC activities than the female.

Table 3: Age of the respondents

Source: primary data

From table 3 above shows that 33.3 % of the respondents are between 18-29 years, 40% are between the age of 30-39 and 26.7 are above 40 years. This therefore means that most of the respondents are above 40 years of age and therefore have good experience in the subject of study.

Table 4: Education level of respondents

Source: primary data

Table 4 shows that 33.3% of the respondents are primary school and secondary school drop out; while 23.3% and 13.3% are certificate holders and other qualification respectively hence the majority of the respondents are literate.

Pie chart showing the findings on education level of respondents

Source: primary data

HOW ROSACA ARE stated and managed among the rural poor in kyeizoba sub-county in Buyanja Village Bushenyi District

Table (6a)

Most of the respondents in the study stressed that the main purpose of ROSAC was to end poverty   this was clearly stated by one of the respondents in the study who stated that.

“Since most of us are poor and donot have money to helps us in increase the size of our firms we decided to start up the ROSAC to give us the lamp sum money we need to raise the size of our firms and enable use live better life”. Mr David.

ROSAC was created mainly to enable the members have capital to start up a business which they individually wouldn’t be able to start with their individual capital, this was clearly started by one of the respondents who stressed that,

                     “Starting up a business requires a lot of money which we cannot afford therefore starting up ROSAC was necessary so that we can raise the capital and we start up some of the business that we dream of”, Ms. Florence

The findings from the field indicated that the respondents stressed that ROSAC was started to enable the members start up economic development in the area, as clearly elaborated that,

 “This area is economically under developed and therefore formation of ROSAC was necessary for us to improve on the economics of the area”Ms. ASIIMWE.

To unite members together to enable them fight for the economic transformation of the area this was further stated by one of the members in the group who stressed that ,

“When the members are united together we can transform our village to modern place” Mr. Derrick.

According to the findings in the study most of the members stressed that ROSAC was established to enable the development of the agricultural sector as started by one of the members in the study who clearly stated that,

“Since the agricultural sector needs enough money to purchase some of the requirement like pesticides, land and poultry houses we therefore found it necessary for us to start up the ROSAC so that members have the money to develop” . Mr. Bonny.

The findings in the study shows that they were many members who started the ROSAC but some dropped off, but the actual numbers was mainly around 20 members however

“Most of the members dropped off due to unclear reasons perhaps due to lack of vision for the organization”. Mr.  Edward.

The results in the study shows that ROSAC has an appropriate way of dealing with defaulters as started that;

“The members are fined and they pay interest on the damages caused to the group”. Ms ATWINE.

Table 6(b) Socio-economic effects of ROSAC on the rural poor in Buyanja village Kyeizoba sub-county Bushenyi

Source: Primary Data

According to the results in the study majority of the respondents stated that they got a lot of benefits from ROSAC as stressed by one of the respondents,

“Due to the ROSAC mode of operation I am able to pay for my child Ronald schools fees and is now in senior FIVE something I could not manage personally”. Ms. RESTY.

The findings in the study shows that most of the respondents assert that ROSAC has enabled them to create business as stated by one of the respondents who was a Banana Trader that “

“I now own three stores dealing in Banana business something I could not afford to won without dealing with ROSAC”. Mr. DAVID.

The results in the study shows that most of the respondents assert that ROSAC has enabled them to Increase on their house hold income, this was clearly stated by one of the respondents who stated that,

 “ I am now better financially than before I joined ROSAC since I can now afford many things like paying school fees for my children, and I have also expanded on my Farm land which has helped to be a better man at home”. Mr. JOHN PAUL.

The findings in the study shows that most of the respondents started that ROSAC has helped them to widen their connection this was stated by one of the respondents who started that,

 “I have now many friends and I meet new people because of ROSAC”.  Mr. TOM

The results in the study shows that most of the respondents assert that , Most of the members have been able to start up their own business and therefore it has enabled them to increase on their income as clearly stated by one of the respondents that,

“I managed to create a strong business due to ROSAC and I now live a happy life as a business man”, Mr. TADEO.

The results in the study shows that most of the members hold the view that , The community  have been united together by ROSAC and therefore they now chase one common goal together, this was further clearly elaborated by one of the members who was a charcoal trader that,

“ROSAC has brought members together and has made them to consider one another as brothers and sisters since they fight for one common goal of self development under the organization” MR. WILLY.

According to the findings in the study most of the respondents assert that the level of poverty has reduced among the members under ROSAC, this was further stated by one of the respondents in the study who stressed that;

“Due to ROSAC most of the members here now live better lives since it has helped in the reduction of poverty levels in the area”. Ms Sarah.

The study further demonstrates that the illiteracy level has reduced since most of the members can afford to buy for their children scholastic materials, this was started by one of the members in the study who was a councilor in the area that ,

“since scholarstic materials were expensive for most of the parents in the area, those in the ROSAC have managed to keep their children in schools since they can afford the needed items”. Ms. Carolyn.

Table 7

Challenges faced by ROSCA in Buyanja village?

Source: primary data

According to the results from the table ROSAC members face challenges like Investment decisions is always hard for the individual ROSAC members since most of them are illiterates

“Therefore when they get the money they donot know what business to do”,  as stated by Mr. Francis.

The ROSAC group faces a challenge of illiteracy since most of the members did not go to school, this was further stated by Mr, Francis Who states that,

“Most of the ROSAC members donot know how to read and write and all of them are fartmers who some of them are Banana growers other Coffee”, Ms ATWINE.

According to the findings in the study most of the respondents assert that most members have big families were by saving is hard. This was clearly elaborated by one of the respondents, who stated that,

 “The members of ROSAC on average they have around five children and yet they donot have formal employment b, this has made it had for most of the members in the group to save and bring themselves up from poverty levels, this factor has greatly stifled their growth of most of the group members”. Mr. Francis.

CHAPTER FIVE

DISCUSSION OF FINDINGS, CONCLUSION, RECOMMENDATIONS AND AREAS OF FURTHER STUDY

5.0      INTRODUCTION

The study aimed at establishing socio-economic effects of rotating savings and credit association on the rural poor in Buyanja Village Kyeizoba Sub County Bushenyi District

5.1 DISCUSSION OF FINDINGS

5.1.1 HOW ROSACs are started and managed among the rural poor in Kyeizoba Sub-County in Buyanja village Bushenyi District

Most of the respondents in the study stressed that the main purpose of ROSAC was to end poverty   this was Bouman (1979), who goes on to define ROSCAs as a group of individuals who come together and make regular cyclical contributions to a common fund which is then given as a lumpsum to one member in each cycle. A member will lend money to other members through his/her monthly contributions. After having received the lumpsum, when it is his/her turn, he/she then pays back the amount in further monthly contributions and this explains the name for ROSCAs. Depending on the cycle in which a member receives his/her lumpsum, members alternate between lenders and borrowers. There is therefore a mutual give and take involved in ROSCAs.

ROSAC was created mainly to enable the members have capital to start up a business which they individually wouldn’t be able to start with their individual capital, this is also explained by Bouman (1979) who states that the amount to be contributed in each cycle is decided based on the number of participating members, the total winning amount that each member can get and other socio-economic factors. The contributions can also be in form of shares, thus allowing a member to have more than one share or contribution in a particular cycle, increasing their chances of winning the lumpsum but also increasing the regular contributions to be made.

5.1.2 Socio-economic effects of ROSAC on the rural poor in Buyanja village Kyeizoba sub-county Bushenyi

The results in the study indicates that ROSAC helps to Increase on the house hold income this is also in line with Okirigiti, (2015) in revealed that majority of the women who are members in these organizations contended that their household incomes had improved significantly; they were able to pay school fees for their children, engage in small scale businesses and are able to save some amount.  The rural women have knowledge, skills, potential and are able to mobilize resources.

The result in the study indicates that Most of the members have been able to start up their own business and therefore it has enabled them to increase on their income this is also in line with (Anderson and Baland, 2002). Besley, et al, (1993) who states that ROSCAs enable women to deal with a wide variety of needs, including household savings and financing of economic activities also demonstrate that ROSCAs are more efficient than autarchic saving and improve the individual welfare of those excluded by formal credit markets. In a follow-up study (Besley, et al, 1994), they compare random ROSCAs against formal credit market solutions; the ROSCAs were more efficient for the criterion of expected utility.

The communities have been united together by ROSAC and therefore they now chase one common goal together, Anderson and Baland, (2002) asserts that ROSCAs serve as a vehicle for saving in households where there are conflicting preferences over immediate consumption versus saving among household members.  While (Besley et al, 1993) further states that the views that ROSCAs are regarded as a sourcing commitment device whereby people can save their money for future use by contributing in ROSCAs.  Members save for buying durables in the long run.

The study indicates that the level of poverty has reduced among women in ROSAC this is also in line with (Bouman and Haeteveld, 1976) who states that Fewer transaction costs also enable ROSCAs members to receive loans quickly.  While borrowers with as little or no credit history may experience some difficulty or delay in accessing funds from financial institutions, ROSCAs members may have funds in as little as a day. Additionally, many meetings are routinely held at a member’s home making it convenient for members to meet without incurring costs.

5.1.3 Challenges faced by ROSCA in Buyanja village.

The results in the study indicates that members are charged interest on the money they owe the ROSAC this is also in line with Makumbe (1996) who states that Defaulting is one major problem associated with ROSCAs.  Some members may default and this will result in uncertainty that can stem from the possibility of a low payout from the ROSCAs arising from the depletion of members.  Sometimes, the member who gets the pot first or second is most likely to default and this will inconvenience other members who are last on the cycle,

Investment decisions is always hard for the individual ROSAC members this in line with World Bank (1986) who stresses that the ROSCAs fund may be used for other purposes other than the intended use. According to, there are possibilities that the ROSCAs disbursement, whenever it occurs may not be sufficient to realize the planned investment opportunity, apart from the possibility that the venture itself may be stressful or unstressful. This is normally popular with consumer durable ROSCAs whereby members plan on buying a durable.  In the event that it has become more expensive than anticipated, members may end up opting for the cheapest commodity.

5.2 CONCLUSION

The study concludes that the members in ROSAC should continue being loyal to the group opinions to enable the progress of the ROSAC.

5.3 RECOMMENDATIONS

The study recommends the ROSAC to consult other members in the investment decision so that to enable better progress of the organization.

5.4 AREAS OF FURTHER STUDY

The study recommends the following areas of further study;

The challenges of poverty eradication by ROSAC

The influence of inflation on the performance of ROSAC

The relationship between interest rates and performance of ROSAC.