Visiting Bomalang ‘ombe

The trip from Iringa to Bomalang ‘ombe is about a two hour drive.  It starts out on a paved road, then shortly turns into a rough gravel road, and then, for about the last 45 minutes of the drive, it is a hard packed narrow dirt road with deep ruts cutting across the road.  During the rainy season, the rain washes deep ruts in the road that stay there for the remainder of the year.  We are told that the road is re-graded every year, but we saw no evidence of the re-grading.

The Chairperson of the SACCOS began the meeting with introductions, then we quickly moved into the reports of the progress of the SACCOS.  The SACCOS has 56 members, of which 24 are women and 32 are men.  All are members of the AMCOS.

There are eleven members attending the meeting today.  All are either officers or members of the board of the SACCOS or the AMCOS.  In addition the Pastor of the local parish is attending. 

The SACCOS has TZS 5,000,000 in internal capital.  They borrowed

TZS 10,000,000 from the Joint SACCOS.  Of this, TZS 1,000,000 remained in the bank and TZS 14,000,000 (about $6,200) was loaned to the members.  There were 34 loans taken out for an average value of $182 per loan.

Of the above loans, some loans were taken in cash and some loans were taken in farming inputs, such as fertilizer.  The members paid interest on the loan of the value of the fertilizer, procured by the SACCOS.

Yari Kimata, who we later interviewed, said that he previously didn’t understand the benefits of having an Iringa Hope AMCOS, but now he is glad we are there to explain how the AMCOS and the SACCOS can work together.  He said that he thinks that they will be able to move ahead rapidly and perhaps have their AMCOS registered in August.

When Venance began explaining how the AMCOS and the SACCOS will work together, as in meetings in other villages, there was a lot of discussion and many questions.  Today, our meeting in Bomalang ‘ombe was no exception.  There was a question about how does an AMCOS survive, when all the capital is in the SACCOS.  This is an important issue for members to understand.  Because the AMCOS purchases farming inputs direct from the suppliers, the AMCOS obtains better pricing than the members are able to obtain when they purchase supplies from distributors.  The expenses of the AMCOS and the Joint AMCOS are recovered by a small mark up applied to the supplies purchased and the members are still able to obtain the supplies at a lower price that they otherwise would have paid.

Another member asked about how much interest will the SACCOS charge to the AMCOS.  This is another good question because it is important for members to understand that the SACCOS charges interest to members who take out loans, whether in cash or in vouchers for farming inputs.  The AMCOS manages the transactions and takes cash from the SACCOS and carries out the purchases at the members’ direction.  Therefore, the member pays interest, not the AMCOS.

Another member stated that the distributors are always late coming to the village.  If we make it clear that farming inputs such as seed and fertilizer will be delivered on time for planting, non-members will want to buy from the AMCOS and, very likely will want to join the AMCOS.

Last year, the SACCOS purchased fertilizer for members in lieu of cash given to the members as loans, and the members paid back the loans, as if they had been given cash.  The SACCOS Treasurer said that, due to complications in the past, we should implement the AMCOS and let the AMCOS purchase the farming inputs for the members and let the SACCOS focus on granting Micro Finance loans.

The Chairman of the SACCOS shared his concern about the quality of the fertilizer that had, in the past, been purchased.  Fertilizer had been delivered, but it was the wrong type, meant to be used on other crops.  It was delivered late.  It was probably fertilizer that was left over from last year and was re-sold this year.  The fertilizer was hard and had hard lumps of fertilizer that made it difficult to use. 

The Treasurer said that fields in Bomalang ‘ombe are being prepared now for planting in August.  Can we get fertilizer and seed forecasted now and ordered for delivery in August?  Apparently for the soil conditions in Bomalang “ombe, potatoes can be planted three times per year and farming inputs are needed for planting in August. 

Yari Kimata said that the loans from the Joint SACCOS that were received and loaned to members from last October have not yet been re-paid, but funds are needed to loan to members for planting in August.  Apparently since planting can take place on a year round basis at this location, Bomalang ‘ombe may need additional consulting on how to manage this year round loan process.

The Pastor thanked us for bringing the AMCOS information to them and asked us to thank the Joint AMCOS for what they do.  He also said that he wants us to go to the Yara Fertilizer warehouse when they will be shipping bags of fertilizer to Bomalang ‘ombe to ensure that their shipments are correct and he would like us to stamp the bags with an Iringa Hope stamp to assure that it is the correct fertilizer.

The Chairman of the SACCOS said that people are used to selling maize.  Have we thought about marketing other crops?  Since this is an area that also raises potatoes, Venance responded that we should consider the marketing of potatoes.  Potatoes can only be stored for about a month, so, since they are perishable, they are not candidates for storage in the IDC warehouse. 

The Chairman said that they are looking for sources for seed potatoes.  He said that it would be helpful to receive recommendations of varieties that would be best for the soils and climate of Bomalang “ombe.  Venance said that it would be important to have all the farmers growing the varieties that the buyers wanted. 

The Chairman of the AMCOS said that using the AMCOS to organize the collection of Potatoes to a central location for selling is a function that the AMCOS could do very well.

Since some of the members were sitting in front of a window, it was difficult to take a photo because of the glare.  We suggested that we all move outdoors in the sunshine to take a group photo. 

Our first interview today was Zaina Luhwago.  She is 50 years old.  She has been a member of the SACCOS for four years and serves as the Secretary of the SACCOS.  She has four children; one son and three daughters.  Her three daughters are 30, 23 and16 years old.  Her son is 10. 

Zaina raised one acre of potatoes.  For her first loan, she took out TZS 495,000 for fertilizer and for hired labor to raise the potatoes.  She was received income of TZS 1,495,000 and was able to obtain a profit of TZS 1,000,000 (about $440) after repaying the loan.  From the profit, she has been able to purchase school uniforms and send the children to school.  She was also able to wire her home and connect it to electricity.

Her second loan was for TZS 350,000.  She rented an additional ½ acre and is raising one acre of maize and ½ acre of potatoes.  The loan enabled her to purchase seed and fertilizer for the maize and potatoes.  She has not yet harvested the potatoes or the maize, so she hasn’t yet recognized her income.

She intends to use her profit from this loan to continue to send her children to school, and increase her savings so that she can borrow more.  (The SACCOS requires members to have 1/3 of the value of their loan in savings at the SACCOS.)  She also plans to purchase more land.

Zaina says that the SACCOS has made a difference in her life.  She is happy.

As she is leaving, Zaina tells us that she is Itiweni’s sister.  Itiweni, our Senior Manager of Iringa Hope is originally from Bomalang ‘ombe.  Later, Itiweni informs us that in Tanzania, all of your cousins are called sisters. 

Our next interview is with Yari Kimata.  Yari is 33 years old, is married and has one son, 10 years old.  He has been a member of the SACCOS for four years, and is now a member of the board of directors of the SACCOS.  Yari owns and manages a shop where he sells the things that are needed in the village, such as soda, flour, rice, cooking oils and any kind of domestic supplies.  He has had the shop for five years. 

He has used his profits to pay for his son’s school uniforms and primary school fees and to connect his home to the local electric lines.  In the future, he plans to use his profits to increase his savings and to increase his loans, and to buy land for a shamba (a small farm) and to hire laborers to help him to run the farm.

He said that the SACCOS is known by many people in town and more non-members are talking about wanting to become members.