Kiponzelo-Growing Fast

Today we went out to Kiponzelo.  Kiponzelo is about an hour’s drive southwest of Iringa.  Most of the trip is on the highway, but the last twenty minutes are down a rutted dirt road.  We first visited Kiponzelo in 2013 with a group from Gustavus Adolphus church.  At that time there was a lot of enthusiasm and 42 people signed up to form their SACCOS.  Visiting now, two years later, this SACCOS has 108 members and another 10 are working on joining.

We stopped in at their office and chatted with the officers of the SACCOS.  Like most of our SACCOS, Kiponzelo has been profitable since their first year.  In 2014 they earned 3,000,000 TZS (about $1,700).  They have slowly added to their initial capital so that they now have 11,000,000 TZS or about $6,500.  However, with over 100 members this is not enough for all of their members to get a loan.  Last year we arranged for them to receive a loan from Iringa Hope of 23,000,000 TZS ($13,500).  Putting this together with their own capital they were able to give loans to about one half of their members (their average loan was 350,000 TZS or about $220).  They were anxious to hear if they might be able to borrow more capital this year. 

We told them that this year we are planning on adding 200,000,000 TZS (about $110,000) to the Iringa Hope capital base, but with more SACCOS joining it was likely that they would have access to a little less than last year.  Tom was apologetic about this.  He told them that he would send them as much as he could, but it would likely be less than what they had last year.

We talked a little about last year’s loans.  When we were at Kitowo we learned that a combination of poor yields, low prices, and hail damage made many farmers’ crops a loss.  But at Kiponzelo they had slightly better than average maize crops (about 17-20 bags/acre compared with 10 at Kitowo) so even though the prices were very low, they still made money.  They told us that once again this year their SACCOS had 100% on time payment for their loans.

We told them that we were starting five AMCOS (Agricultural Marketing Cooperatives – the Tanzanian equivalent of a Farmer’s Coop) this year.  The Kiponzelo SACCOS members have been very anxious for us to help them start an AMCOS.  We think that this would be an ideal area in which to start an AMCOS, however we are concerned about having enough capital to start the ones we already have promised.  Besides, what they really need right now is more capital for their loans.  Everyone agreed with this, but they still would like to start an AMCOS.

Following our meeting with the officers, we attended a general meeting with the members.  The room was packed tight.  There were 41 members in the room and more would have liked to come in.  Tom discussed with them how the funds are handled in Iringa Hope.  He emphasized that they own and run everything in Iringa Hope – so when they borrow they borrow from their neighbor.  Everyone here takes their SACCOS very seriously.  As Peter began to talk the skies opened and the rain poured down on the roof.   Those of you who have had the experience of being in a brick building with a tin roof during a heavy rainstorm know what happens next; the noise is so deafening that nothing else can be heard. 

We stopped the class on SACCOS and Sandy took out the Iringa Hope calendar and went around the room showing it to the members.  Our calendars are always a big hit over here.  People all want a copy and want to know how they can get their picture in next year.  We bring as many as will fit in our luggage, but it only amounts to two per SACCOS.

When the rain let up we went back to our meeting.  Peter gave a good discussion of the importance of planning and how to be effective.  We finished up by answering questions and asking for volunteers for us to interview.   One question kept coming up – how can we get more capital?  Tom pointed out that 5 years ago Iringa Hope had 0 TZS while by the end of this year we will have 800,000,000 TZS – so we have made great strides. 

Sandy went off to interview two members while Tom and Peter finished up with the members.  The first member that Sandy interviewed was Tarchisia Nyenza.  Tarchisia is 42 years old, married, and has 5 children.  Two years ago she borrowed 90,000 TZS (about $60) to buy fertilizer for her maize.  She got a good crop, yielding 20 bags from her one acre.  She decided to keep 10 bags for consumption by the family and used the other ten bags to make corn mash for brewing.  When she sold her brew she earned 800,000 (about $530) which, after deducting all costs, netted her 500,000 TZS (over $300) profit for the year.  She used most of her profit to buy her children school uniforms and pay fees, but she also added to her savings.  This year she has borrowed $200 to plant her crop.  At the moment her crop is in the ground, however she is hoping she will do better than last year.

Sandy’s next member was Exaud Cosmas Myinga, a 34 year old married man with 1 young child.  Exaud has also taken out two loans.  His first loan was for 550,000 TZS ($370) to plant 3 acres of maize.  He sold half of his fresh corn (the younger ears used for roasting) for 450,000 TZS ($300) to one trader and the other half for 340,000 TZS ($220) to a second trader.  Unfortunately while the first trader paid him, the second one ran away with the crop and did not pay.  When the rest of the crop was harvested he had another 26 bags of maize.  He sold half of this maize for 30,000 TZS a bag (remember that in Kitowo they only got 20,000 TZS) and kept half to eat.  So how much did he earn?  If he had gotten paid for all of his fresh corn and had sold his entire crop he would have earned 780,000 TZS (about $520).  As it was he wound up earning 280,000 TZS ($185) in cash and enough maize to eat for the year.  Not bad, but not what he could have earned.

And what did he do with his earnings?  He told us that since his son is still young he is not yet in school, so he has started to build them a real house with a floor and a roof.  He figures that this year’s profit has covered about half of the cost of the house he is building.  He has taken out a second loan for $830.  He plans to use this to plant maize using better seeds and fertilizer.  He wants to again sell half of his crop as fresh corn and half after the final harvest.  He thinks that this will allow him to finish his house, and still increase his savings.

After finishing the interviews we went in to have lunch with the officers.  Once again they wanted to talk about how to get more capital and how to start an AMCOS.  This is a SACCOS with strong leaders and enthusiastic members, so we hope they will get the capital they need to grow.  

First we stopped into the SACCOS office to talk with the officers.

The room was crowded as we started the meeting.  A number of members stood outside looking in.

Sand addressed the meeting in Swahili.  She always gives a greeting and gets lots of smiles and applause.  (Tom on the other hand keeps confusing the Swahili words for hello and good bye; often getting his own laughs for a different reason.) 

Peter gave a lesson on on planning.

While Tom continued with the meeting, Sandy interviewed some members.

The first member that Sandy interviewed was Tarchisia Nyenza.  Tarchisia is 42 years old, married, and has 5 children.  Two years ago she borrowed 90,000 TZS (about $60) to buy fertilizer for her maize. 

Sandy’s next member was Exaud Cosmas Myinga, a 34 year old married man with 1 young child.  Exaud has also taken out two loans.