Mpamba is a bustling trading centre in the Nkhata Bay District of Malawi. It is close to the port town of Nkhata Bay. Our work with villagers in Mpamba started as a result of the local community expressing a desire to address the issue of financial services. These low income households, which largely rely on subsistence farming, require financial services to improve farming productivity and/or establish local enterprises. Furthermore, households would often save money within their homes, where they were prone to theft. The problem back in 2016 was that households were often excluded from the local financial system due to a lack of collateral for credit (valuable assets), or prone to predatory microfinance organisation (exhorbitant interest rates).
In response, households across 38 villages in the region pledged to work with us to establish a community-owned financial cooperative. This is a community bank that is regulated by the ReserveBank of Malawi, as well as a union for financial cooperatives (MUSCO). It is an institution operated by a community board, where each member is a part owner and received dividends (profit share) in proportion to how much they have saved with the bank. This bank was established in 2016 and is known as the Timbiri Savings and Credit Cooperative.