Building Savings & Social Capital in Malawi

Federation women Malawi


As of 2017, the Malawi Homeless People’s Federation has organized 505 groups in 28 cities and towns. It is well known that the central organizing tenet of SDI revolves around women-led savings groups. The value of savings to a poor community’s ability to absorb or adapt to shocks and stressors is paramount, and the social networks that women-led savings group create amplify benefits to community resilience. In 2017, the federation facilitated the formation of new savings zones in Thyolo, Mulanje, Chikhwawa (Southern Region), Mchinji and Salima (Central Region), and Rumphi and Nkhata-Bay (Northern Region). The formation of the savings zones has helped create frequent learning platforms that enhance the social, political, and economic capital in these local networks. In addition, the year saw the federation conduct regional youth savings symposiums. The symposiums brought together youth leaders from all districts and the mobilization of approximately 500 youth savers.


During the course of the year, the federation participated in dozens of meetings and forums organized by government and its agencies. During the meetings, the federation advocated for the adoption of federation rituals – especially savings – throughout slum communities in Malawi. As a result of the meetings, the federation entered into an agreement with the Reserve Bank of Malawi (RBM). The agreement will see the federation working hand in hand with the central bank in mobilizing and training savings groups throughout the country. The federation was identified by the central bank after noticing that almost all the other savings approaches have been plagued by mismanagement. This agreement is expected to increase the visibility of the federation, resulting in the opening of new saving zones, an increased number of organized urban poor communities, and reduced vulnerability in slum communities.


As savings groups and networks mature, they move into loan-making and explore more creative community funds to support basic services and infrastructure projects. Households contribute monthly to funds from which they are able to take loans. Within the savings group structures, the federation has introduced training on group investments, documentation on the impact of savings, and loan interest tracking and management. To increase livelihood options, close to 100 youths were equipped with skills in the production of various art and craft products and one group in Lilongwe opened a bakery. These efforts enhance financial literacy and access in urban poor communities and create improved economic livelihoods. The networking of these groups at settlement, city, and national levels builds social and political capital in urban poor communities.

The Malawi slum dweller federation efforts contribute to city resilience through the building of collective identity and community support as well as the building of skills and training that improve urban poor livelihoods.

 This post is part of a series of case studies from our 2017 Annual Report titled ‘The Road to Resilience.’ Emerging from the field of ecology,  ‘resilience’  describes the capacity of a system to maintain or recover from disruption or disturbance. Cities are also complex systems and a resilience framework addresses the inter- connectedness of formal and informal city futures. Moreover, it enables a nuanced reflection on the nature of shocks and chronic stressors – recognising that the latter are particularly acute in slum dweller communities and that this critically undermines the entire city’s economic, social, political, and environmental resilience.As with personal resilience, city resilience demands awareness, acknowledgment of reality, and a capacity to move beyond reactivity to responses that are proactive, thoughtful, and beneficial to the whole. The most enlightened individuals and cities will be those that understand their responsibility to the most vulnerable and to the planet. Our 2017 Annual Report showcases some of SDI’s achievements over the past year on the road to resilience. Click here for the full report.