What is table banking?

Table banking is being used by many groups now. It has more structure than in many arrangements popularly called ‘merry-go-round’ where people have no repayment schedule. Often they just pay interest on the loan & the group cannot lend again because the capital is tied up. So with TB the group has to set rules for lending & repayment. Also having shares requires rules and gives people ‘ownership’ They have to be more business like & assess the capability of an applicant to repay. They also have to separate ‘compassionate’ handouts or loans (for eg sickness & funerals) from the real ‘banking’ business. They are in fact setting up a small bank. I gave them a number of case studies to look at where they could see what people had done both with small loans and with ‘top up’ loans for larger amounts. We had nearly 30 people for the morning. Both Safaricom & Airtel are offering loans through the mobile phones. The interest rates are low but the repayment period is short.

Creating a savings culture is very important. One woman said at the end that she had never realised that it was worth saving even 50/- a week and that it would amount to something if she bought shares.