I had an interesting discussion with Zbinite Wilson Wizalamu who is the founder of Centi Centi SACCO which has members in Zimbabwe and South Africa. He is also a board member of The National Association of SACCOs.

The history of Savings and Credit Associations in Zimbabwe was tainted by Housing Cooperatives where many lost funds. So mention Cooperatives—and many will shy away, it is synonymous with fraud and mismanagement.

However there are quite a few which are doing well with the Teachers SACCO having 18,000 members and in 2017 they had a balance sheet valued at US$18 million before currency conversion in 2019.

The Biggest Risk ZBIN Crowd funding Projects Faced.

Capture, Capture and Capture of Projects. Registered as companies or simply roundtables.

Solution=SACCOs

And here is how;

1. A SACCO needs a minimum of 10 members for registration purposes.
2. The 10 members will form a (1) management committee, a (2) supervisory committee, a (3) loans committee, and a (4) education committee.
3. The treasurer has to submit a CV for review and reference purposes.
4. In addition, the SACCO has to be part of a National Association of SACCOs.
5. They will be regulated by SACCOs Statutes.
6. Upon registration—they receive a certificate.

With the above steps—it is almost impossible for a single person to override the systems and everyone and convert a Crowd funding Initiative into a personal property. The corporate governance structure is regulated with statutory reporting and compliance.

A registered company can easily be converted into a personal project. One can use political power to systematically remove every shareholder taking advantage of commercial law illiteracy. Start-up companies vulnerable to takeovers by greedy members.

SACCOs government oversight makes it easier to lodge complaints for review.

Unregistered round tables easy for take overs or the founders disappearing from the scene.

So the message from now is SACCOS, SACCOS, SACCOS and SACCOS.

Kenyan  SACCOS

In Kenya SACCOS hold a combined US$14 Billion in assets or 10%of the GDP.

The benchmark for Zimbabwe should therefore be US$4,5 Billion

A benchmark of 1% means at least $450m but we doubt whether  total assets are worth $20 million.

But as the biggest small business forum in Zimbabwe with 180,000 Active Members, ZBIN has an opportunity to tap into the US$4.5 Billion market provided we have well run SACCOs.

The Jangano and Thuthuvaka Crowdfunding Projects currently hold less than US$20k in funds but have huge potential through laying a solid foundation. Convert into SACCOs in future and the sky is the limit.

Formalize Your Crowdfunding Initiatives

In order to grow and tap into the potential US$4.5 Billion market—ensure you formalize your entities. Yes you don’t have to open up to the public, but lay solid foundations for future upscale and growth.

And if not subscribed to ZBIN—you have an opportunity to be a member of the forum and not be left out.

Access to finance to the informal sector remains a huge challenge in Zimbabwe and the status quo unlikely to change in the near future. First, the numbers are too huge with the informal sector slowly becoming the Real Economy.

Economic sectors where the informal sector has taken over include the Transport Sector, Gold Deliveries, Retail, Tobacco Farming and the list is long and growing every day.

When it comes to banks lending the informal sector, the challenge becomes how when most have no assets that could be used as surety? Location in some cases is not fixed. The high risks profiles makes it difficult to extend loans to the informal sector.

The good news is that we have come up with an innovation which could be used and we provide a case study below;

In November 2024, 90 members from the forum started a crowdfunding project called Jangano Crowdfund to purchase land. All the members paid $30 for 6 months into an FBC Bank Amounds Account. The FBC Amarounds Account is tailor made for the informal sector—easy to open and run.

• Now Jangano Crowdfund has a record of performance with FBC Bank Account.
• Each member’s deposits are captured on a monthly basis—who has been depositing on time and who has been missing deadlines?
• The bank account also shows who has paid up front.

Members of Jangano Crowdfund are dotted across the country and also includes some from the diaspora such as UK, USA, SA and Mozambique.

Could this record be used as a credit score? Well its too short a period—just 6 months. But over 12 months to 36 months, performance could be used to judge how much each member is able to deposit.

The fact that someone is part of a team(First as a registered member of ZBIN) and secondly as a member of a Crowdfunding and lastly with own deposit performance record. The bank can be able to assess the financial risk of loans up to a certain amount. And the good news is that this applies to diasporans.

Message to informal sector: Yes its convenient to have cash in a cash economy—but try and open bank accounts for your crowdfunding projects. Have a performance record for the projects and individual members. This could become your credit scores in future.