Investigating the long-term sustainability and economic contributions of village banking in Zambia : a case study in three selected areas in Lusaka.

This research investigated the sustainability of village banking and its contribution to economic growth in Lusaka, Zambia. The study was conducted in three areas of Lusaka, Zambia: Chilenje (CHL), Chongwe (CHO), and Kamwala (KMS). A total of 34 participants were investigated, exceeding the original sample size of 30. Data was collected through questionnaires, interviews, focus group discussions, observations, and secondary data, and analysed using descriptive and thematic analysis methods. The study found that village banking is a popular financial strategy among individuals with significant familial responsibilities. It also revealed several challenges faced by village banking groups, including lack of resources, lack of proper
full literacy, lack of formalisation, and issues with people defaulting on loans. In terms of licensing, more licensed businesses were owned by males, suggesting potential barriers for women in formalising their businesses. On the taxation front, village banking contributes to taxation and revenue generation at various levels. The study concluded that while village banking has potential benefits, addressing the identified challenges is crucial for its long-term viability and its potential to stimulate economic growth. Recommendations include the need for robust security measures, formalisation of village banking groups, provision of larger grants and incentives to farmers, financial literacy training and skills development, simplification of
the tax payment process, support for business formalisation, and addressing barriers to access. The findings contribute to our understanding of the economic implications and sustainability of village banking in Zambia.