Ukwega
This morning we had wanted to
start at 8:00 A.M. However we found that
we had a flat tire that needed to be repaired.
It took about an hour, so we didn’t get started until 9:00 A.M.
Ukwega is about a two-hour
drive from Iringa, so we arrived around 11:00 A.M. The scenery is beautiful. The last portion of the drive is along a ridge line. Venance Msigala estimates
that we are at about 6,000 feet in altitude.
As we drive, we see many scenic views of the valleys below. We also note how maize is grown on steep
hillsides to take advantage of all of the crop-growing land possible. There are also beans, bananas and pyrethrum
grown in this area. Pyrethre flowers, when dried, are used to produce pyrethrum, a natural
insecticide.
When we start the meeting,
there are fourteen officers, board members and members of both the SACCOS and
the AMCOS present. It is reported that
there are 83 members of the SACCOS including 15 women and 68 men. Of these, 50 are also members of the AMCOS,
including 12 women and 38 men.
They have submitted the paperwork for registration with the
government, but they have not yet received their certificate of
registration. Venance Msigala will
follow up with the Tanzania Cooperatives Development Commission to follow the paperwork.
We then proceeded to begin our presentation on how the AMCOS
will interact with the SACCOS. Again
there were many questions and lengthy discussions. One of the questions that have been asked
many times previously was whether the AMCOS could consider selling supplies to
non-members. We replied that it is up to
the local AMCOS members. However the
prices to non-members will be higher than the prices given to members.
Another question was asked
about whether there were guidelines regarding how large of a loan is given to
members. We responded that the loan
process for providing loans to members for the purchase of supplies from the
AMCOS is different in that, when the loan is approved, the member is given a voucher
for the amount of the supplies for which his loan is authorized. Otherwise, the procedure for granting loans
should be the same as before the AMCOS was in place. All decisions on loans are up to the judgment
of the loan approval committee.
There was a question about
the cost of supplies. In 2016, when
members took out loans for supplies, the interest charged by the Joint SACCOS
for capital loaned by the Joint SACCOS to the SACCOS was 15%. This interest was then charged to the SACCOS
member who was purchasing the supplies.
Jeff Duma then placed the order for the fertilizer. There was a concern that with our discount
plan, the price for fertilizer would be higher than previously charged. We responded that the current plan is
different than what was done in 2016. However, because we are dealing directly
with suppliers, the prices that members pay should be less than the prices
charged by distributors or other middlemen.
There was a concern that all
supplies would need to be delivered to the village before the rains begin. In this area, once the rains begin, it would
be difficult for delivery trucks to reach the village. We said that our timeline plan is that all deliveries
should be made by October 1. Members
agreed that delivery by that date should be sufficient.
There was a discussion about
the One Acre Fund. The One Acre Fund
(1AF) supplies fertilizer to farmers at the beginning of planting season, on a
loan basis. The terms of the loan are
that 1AF expects loan repayment on a regular basis immediately upon the
granting of the loan. Members reported
that 1AF provided soil testing and provided Urea + DAP + NPK fertilizer to the
farmers. Members reported that the crops
did very well. However Urea + DAP will
cause the soil to become even more acidic.
This is a problem at the high altitude areas. In a later meeting we discussed this with
Yara Fertilizer representatives. We
believe that we can provide farmers with better solutions.
Members reported that bean
seeds were not available for planting.
Most farmers use seed left over from last year’s crop. They have perceived that, as a result, their
yields have been decreasing. We
suggested that Venance Msigala should investigate this with the seed suppliers
that we are meeting.
When farmers are selling at
harvest, the prices are typically the lowest through the year. Some farmers would like to leave their beans
with the SACCOS as collateral for additional loans. We responded that as the general rule, the
SACCOS or the AMCOS should not accept the risk for decisions that farmers
make. As part of a warehouse receipt
program, the SACCOS could grant a loan for 60% of the market price of crops at
harvest so that farmers could have funds for the purchase of farm inputs for
the next year, to pay for their children’s education, or for other
purposes. But the SACCOS should not
accept the crops as collateral at 100% of market value. Also, loans should not be given if there is
not sufficient loan capital available to meet the needs of new loans for all
members.
Our first interview at Ukwega
was Bertha Ngusi. Bertha is 51 years old
and she has been a member of the SACCOS for three years. She is married and has six children, three
sons and three daughters. Four of the
children are married and two of the children are still living with Bertha.
Her first loan was for TZS
150,000 to purchase seed and fertilizer for one and a half acres of beans. Her income from the loan was TZS 350,000 for
a profit of TZS 200,000 (or about $88).
With the profits she bought three pigs.
Her second loan was for TZS
350,000 to purchase seed and fertilizer for two acres of beans. She earned income of TZS 930,000 for a profit
of TZS 580,000 (or about $256). With the
profits, she bought maize as feed for the pigs and she was able to send her
children to secondary school.
Her third loan was for TZS
450,000. With this loan, she was able to
rent an additional acre of land, so she is now farming three acres of
beans. The crop is not yet sold for this
year, so she hasn’t yet recognized the income.
With the profits she is
planning to purchase hybrid chickens and purchase a tiling machine, to tile
other farmers’ fields on a contract basis.
She is also a sales agent for pyrethre
flowers. These flowers, when dried, are
used to produce pyrethrum.
This is a good example of how, with the access to
credit through Micro Finance loans, and with hard work, SACCOS members are able
to grow their businesses and increase their income, for the benefit of their
families.
Bertha said that she gives thanks for the help and
advice that Venance Msigala gives to her to help her increase her income. “He does a good job as a teacher.”
Our next interview was with Samweli Kigala. Samweli is 43 years old. He is married with one child who is two years
old. He farms five acres of maize and
has one pig. He has been a member of the
SACCOS for four years.
His first loan was for TZS 250,000 to purchase seed
and fertilizer for two acres of beans.
His income from the loan was TZS 600,000 for a profit of TZS 350,000 (or
about $150).
His second loan was for TZS 600,000 to purchase
seed and fertilizer to plant three acres of beans. His income from this loan was TZS 1,300,000
(or about $575) with net profit of TZS 700,000 (or about $310).
His third loan was for TZS 900,000. He is waiting for the beans to sell before he
recognizes the income.
With the profits, he plans to build a small building
that he can use as a restaurant to sell chips and soda pop. He also plans to sell his beans at the Iringa
market. He previously sold his beans to
middle men who came to the village. He
hopes that he will earn higher prices by selling in the market.
Before we left for Ipalamwa, we were invited for
lunch to the Pastor’s house.
We drove to Ipalamwa by
turning back down the road that we drove to Ukwega. Ipalamwa is about a half hour away from
Ukwega. We met with the officers and the
board members of the AMCOS and the SACCOS.
There were supposed to be fifteen members at the meeting, but the
Chairperson said that some members didn’t get the communication.
The AMCOS is registered with
the Tanzania
We heard more about the One
Acre Fund. Members said that the One
Acre Fund delivers inputs on time. Other
villages have complained that often distributors don’t have supplies in stock
and deliver inputs late or not at all.
It will be important to ensure that our AMCOS locations place orders on
time for delivery on time. We have currently
included a sufficient interval for an ordering due date in our timeline
milestone plan.
Another question was, “Why do
we need to join two organizations and pay fees to two organizations when they
are both under he same roof? We
responded to this question that even though our Iringa Hope organization works
for both the AMCOS and the SACCOS, the Joint AMCOS and the Joint SACCOS are
indeed two separate organizations and the requirement for separate registration
fees is not optional but is a requirement of the Tanzania Cooperatives
Development Commission.
Venance will be making recommendations of the
seed varieties that are known to do well in each area.
Another question asked was,
“Can the AMCOS market two crops; maize and beans?” Our response was that we are investigating
alternative markets to ensure that there are markets available at the best
price for the AMCOS members when they want to sell their crops. Our first priority is for maize, since it is
the predominant crop for this area. We
will also investigate markets for other non-perishable crops.
The Chairman of the SACCOS
said that people from other lending institutions, including other cooperatives
and the CRDB BANK, have contacted him.
Their interest rates are all very high.
He thanked us for the work that is being done. He said that he tells all other institutions
that before they contact him, they should contact Iringa Hope and discuss any
proposals that they have.
He thanks Iringa Hope for the
work that it is doing and he thanked Venance Msigala for the good work that he
is doing to advise their members.
We then proceeded to have two
more interviews. The first interview was
Jeneda Kasuga. Jeneda is 50 years
old. She is married and has six children. She has three daughters and three sons. Their ages are 35, 25,19,12, 9, and 7. She is a member of both the SACCOS and the
AMCOS. By coincidence, Jeneda is a
relative of Gedion Chusi. Gedion’s
father is originally from this area.
Jeneda farms four acres. She
farms two acres of maize and two acres of beans.
Jeneda’s first loan was for TZS
135,000 for cultivating beans and maize.
She reported total income of TZS 935,000. She realized a profit of TZS 600,000 for her
beans and an additional TZS 200,000 for her maize, for a total profit of TZS
800,000 (or about $350).
Her second loan was, again,
for TZS 135,000. She received income of
TZS 685,000 and a profit of TZS 550,000 (or about $250).
Her third loan was, again,
for TZS 135,000. The yield for her crops
are not yet in, so, she has not yet realized the income for the year.
She has used her profits to purchase
better food for her children, to send her children to school and it helped to
pay for some hospital treatment that was required. She said that she thanks us for the meeting
to share information with the members and she thanks us for organizing the
AMCOS. She is confident that it will make
a big difference in their lives.
The next interview was with Aspilwe
Kasuga. Aspilwe is 38 years old and has
been a member of the SACCOS for three years.
He is also a member of the AMCOS.
He has four children, one
daughter and three sons. His children
are: twins that are 11 years old, a six year old and a three year old. He farms four acres. He has one and a half acres of beans and two
and a half acres of maize.
His first loan was for TZS
300,000 for seed and fertilizer for maize.
His income was TZS 1,950,000 and he realized a profit of TZS 700,000 for
his maize and an additional TZS 950,000 for his beans, for a total profit of
TZS 1,650,000 (or about $730). With the
profit he realized, he paid for uniforms and school fees for his children and
he bought 4 goats.
His second loan was also for TZS
300,000. The income that he generated
was TZS 1,700,000. He achieved a profit
of TZS 600,000 for his maize and TZS 800,000 for his beans for a total profit of
TZS 1,400,000 (or about $620). With the
profits, he made bricks for the house that he is building and he purchased iron
sheets for the roof of his house.
For the future, he plans to
increase his savings in the SACCOS so that he can borrow more money, and he
plans to purchase more land to increase the size of his farm.
He said that he wants to
thank Iringa Hope for bringing the SACCOS and the AMCOS to the village. He said initially his income was down, but
since he has been a member of the SACCOS, he is doing much better.
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