To efficiently develop their activities, small- and medium-sized enterprises (SMEs) must employ systematic management tools throughout their economic and financial transactions. In Siguiri and surrounding rural areas of northeast Guinea, small cashew nut producers and traders face significant organizational limitations due to a lack of information and financing for growth. This challenge often leads to SMEs’ insufficient development or even bankruptcy.
Funded by USAID and the global gold mining company Anglogold Ashanti, the Siguiri Agriculture Development Activity (SADA) aims to improve the productivity and income of cashew nut producers and SMEs in Siguiri. To help them self-finance their production and growth, SADA began establishing 20 functional village savings and loan associations (VSLAs) as a pilot in two rural communes. SADA is providing VSLAs with both technical support, via sensitization and training, and material support, via toolkits, through a participatory approach adapted to the local context. VSLA members meet weekly to pool their savings and then loan out the group’s contributions to finance specific economic activities.
In establishing this basic, self-managed financial system, SADA is cultivating a financial framework that is tailored to VSLAs’ rural capacities, enabling future linkages between cashew producers and local financial institutions. SADA will continue to strengthen the cashew sector by facilitating access to finance trainings and creating the right conditions for a sustainable, commercial relationship among VSLAs, microfinance institutions, and local banks.
To date, SADA’s capacity building activities have reached a total of 496 members, including 148 women, and empowered VSLAs to mobilize 47,639,000 Guinean francs (about $5,366) in the first three months of operations. The process of financial training and mobilization is ongoing. However, with the support of SADA, these efforts will strengthen VSLAs’ ability to finance Siguiri cashew producers and SMEs and extend credit accessibility to individual members.
Sékou Camara, a cashew trader and VSLA member of the Kourouni District, emphasized SADA’s impact on the management of his commercial activities.
“Since we took the training on VSLA management tools, I have changed the way I manage my small business,” he said. “For example, before the training, I did not keep any document to manage my activities, and I often sold on credit without recording the transactions in a document. Thanks to this training, I now understand that I have to write down all my transactions in a document. And, since I started doing it, I have a better visibility on the situation of my business.”
SADA’s interventions have started to enable VSLA members, like Sékou, to engage in financial mobilization, while simultaneously fostering a communal savings and credit culture. This new financial structure will aid members to save the minimum capital needed to finance the development of their individual and collective economic activities, including cashew nut production and marketing.
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Learn more about the Siguiri Agricultural Development Activity.