Ben Hess is a CRS international development fellow living in Guatemala and working with savings-led microfinance programs.

A two-day training workshop on savings-led microfinance is part of a new CRS Guatemala pilot project. Photo by Benjamin Hess/CRS

“I put 2,000 quetzals in the bank a few years ago,” the woman explained quietly, “but when I went to withdraw the money six months later, the bank only gave me 1,800 quetzals.” I listened in shocked disbelief, but other women described similar hidden bank charges and barriers to access due to their difficult economic situation. While 200 quetzals is less than $30, this is a significant sum to lose for a family living on approximately $2 a day. Not surprisingly, the women understand the importance of saving money but had little faith in formal financial institutions.

I was facilitating a two-day training workshop on savings-led microfinance for six women animators and the staff of the Diocese of San Marcos Women’s Pastorate as part of a new CRS Guatemala pilot project. As troubling as the women’s stories were, they provided the perfect contrast to the idea that CRS was promoting—that poor men and women in their communities could develop their own financial services through self-managed savings groups.

In mid-August 2008, CRS Guatemala applied for a small grant from the CRS Latin America and Caribbean regional fund to implement the concept of savings-led microfinance through the formation and training of women’s savings groups in the Municipality of San José Ojetenam, which is located in the Department of San Marcos. Food insecurity, poverty, and illiteracy are endemic in this western border region. Since 2002, CRS and its partner the Women’s Pastorate have coordinated the “Women’s Empowerment and Girls’ Education Project,” which provides scholarships for school age youth, supports adult literacy activities, and promotes increased parental involvement in their children’s education.

The microfinance project’s goal is to usethe women’s savings groups to empower the members, further their leadership skills, and promote solidarity. Interestingly, although the savings groups have a clear economic purpose, the expected financial benefits of reducing the women’s vulnerability to household emergencies and providing members with savings and income-generating opportunities are actually secondary to the social objectives. Therefore, the project’s title is “Solidarity through Savings.”