#WomenSupportingWomen: Kenyan Women Claim Economic Power through Chama Groups

Women in East Africa are leading the way with an informal economic model that enables them to grow their own businesses without relying on men or banks. Chama groups in Kenya continue to be all the rage as more and more women seek financial independence through an economic sisterhood.


What is a Chama?

“Chama” is the swahili word for ‘group’ or ‘body’, and refers to informal self-help groups where members contribute an agreed monthly sum of money with the aim of helping each other grow economically. An ancient tradition initially created by rural women, Chama group members would either club their money together and take it in turns to spend the money on household items or come together to help each other till and harvest their crops. Since their conception, following rising inflation rates and unemployment in the 1980s, Chamas have grown to become microfinance savings and loans companies that enable women to escape the bureaucracy of banks, whilst also forming strong community ties and social bonds.

In 2015, only 17% of Kenyans were in formal employment, with the majority relying on informal labour. With a lack of formal employment in the country, women often start their own side hustle to raise money for their children’s education and to supplement their family’s income. However, the informal nature of their work excludes them from formal bank loans or investment groups, which means they have to rely financially on their husbands. Rather than letting this be a barrier to their businesses, women in Kenya used the Chama initiative to help themselves to be truly independent.

How do Chamas work?

In order to join a Chama, women normally have to be invited by existing members or have several people vouch for their trustworthiness. The groups are all about trust, loyalty and community bonds. There are three recognised Chama structures that women adopt in their community groups:

Merry-Go-Round Chamas

The original Chama structure is known as the ‘merry-go-round’, where each member contributes a fixed amount for a fixed term. At each chama meeting, funds are collected and the whole collection is given to members on rotation.

Bayollah, a member of three chamas expressed how merry-go-round chamas have helped her grow economically:

“Chamas are very important to my life. Since I started the chama, I have really improved because when it’s my turn to get the money, I can organise myself. Then I can buy household goods without relying fully on my salary.”

Pooled Investment Chamas

These Chama groups work by each member making a monthly commitment to invest a minimum amount in the group. The pooled funds are then invested into something that the whole group agrees upon, for example stocks, bonds and housing. Members can also take out loans through their Chama to further their own business ventures.

Agriculture Cooperatives

Agricultural Chamas come together to create large scale agricultural production and export products such as coffee, tea and dairy.

Women choose the Chama models that would best serve their communities depending on their needs. Often, Chamas become long term ventures that carry women through to retirement, giving them financial security in case their business ventures collapse.

Benefits of Chama Groups

1.Economic Independence:


Chamas help their members get loans and borrow money easily, enabling women to gain economic independence. Many chamas act as a way of giving women security for retirement through making long-term group investments. Maureen Murunga, a member of the Unathi Investment Limited Chama, reported to CNN, “The chama has been very exciting in that it's been much easier for us to quickly invest in big deals which would not have been possible if I tried to do (it) myself”. These groups give women an opportunity to take business risks without having the burden of major losses if anything goes wrong.

2.Community Bonding:


Chama groups also act as a social space for women to get together and spend time with one another.They become great support systems for women, providing counseling, advice and a bond that can’t easily be broken. Meetings act as great networking spaces for women to come together and exchange business ideas and Chamas can also be used to organise baby-showers, support funeral costs, and family celebrations.

3.Challenging Gender Stereotypes:


Chama groups are driving forces for gender equality, showing that women can be innovative and make immense economic differences in Kenya. Traditionally, women are expected to carry out household duties and raise the children while husbands go out to work. However, Chamas challenge this stereotype by proving that women can form successful business ventures without men.

Chamas have continued to gain dominance in Kenyan society. There are countless success stories where women have gone on to make millions of Kenyan shillings. For example, Milele Alliance, an eight-member investment chama has an investment portfolio that exceeds SH35 million (£270,000). Many NGOs and governments use foreign concepts of financial success to create poverty reduction programmes, focusing on figures rather than individual stories. Chamas are an ideal model that promotes community building, poverty reduction and focuses on each individual’s needs. It’s time for African governments to look inward rather than outward for the solutions that will empower their communities and drive economic growth. And it’s time for NGOs to shine a light on African-grown initiatives that are making a real difference. After all, Chamas are the embodiment of #WomenSupportingWomen, and a model that the rest of the world could learn from.

Article by VERVE Operative & Blogger Chanju Mwanza

More articles by Chanju 

Website: https://www.chanjumwanza.com