The study investigated informal women traders involved in Micro Credit Schemes at the flea market for that particular period. The analysis of the qualitative data collected was based on the Sustainable Livelihood Approach by SIDA (2001) used to guide the study at the chosen flea market. The study discovered a variety of activities done by women at the flea market, explored the survival and coping challenges experienced by IWTs under economic and environmental hardships and finally, suggested comprehensive interventions and sustainable livelihoods strategies that could be used to out-scale and throw a lifeline to the informal women traders. There were many informal women traders involved in MCSs at the flea market that ranged from groups to individuals. The IWTs depended on MCSs as their source of livelihoods. Flea Markets have become attracting centres for women who want to do business and MCSs enhance the socio-economic development, setting standards for poverty eradication and improving the living standards of IWTs. The data were analysed with regard to the following sub themes; the nature of business, formation of MCSs, types of lending schemes, profit sharing and terms of payment, member’s benefits of MCSs, challenges encountered, why women engage in micro credit schemes, the way forward and finally the conclusion.
The Nature of Business
The study established that generally, informal women traders have a long tradition of working together as groups based on social relationships which revolve around kinship ties, gender or village memberships. The nature of business was centred on MCSs as well as buying and selling assorted local and imported goods that ranged from traditional handicrafts, clothes, hand bags, blankets and kitchen wares to children’s toys. Figure 1 shows the nature of businesses that IWTs were involved in at the time this study was conducted.
The 20 informal women traders and 6 key informants interviewed were involved in MCSs at a particular flea market near the Harare Central Business District. In any case, 10 cited that they were selling mixed products which were handmade e.g. weaving, knitting, and crocheting whilst 5 were selling imported products from other countries. The other 5 reported that they were selling traditional products such as pottery, basketry, locally made weaved floor mats. The study established that for IWTs selling local products, their business was lower than those who were selling imported goods since they were cheaper than the local products. Due to economic choices and preferences, consumers preferred cheap materials regardless of quality. The researchers’ observation was that the emergence of products from other countries had pushed aside the local products. This influenced the position of informal women traders in boosting income in a meaningful way in economic and environmental hardships.
Nature of Micro Investment
Many IWTs reported that they were involved in MCSs not governed by any legislation. Mupambireyi, (2014) confirm that “the informal sector operated outside the realm of official regulatory frameworks and workers are not registered, regulated or protected under the labour legislation and social protection”. The IWTs decided to mobilize themselves and planned their MCSs of their level with affordable rules and regulations they could understand better. Through pooling the resources together based on the group or socio-economic ties to form MCSs (locally known as rounds or mukando) at the flea market, women grouped themselves in a participatory and comprehensive manner. That is; IWTs formed groups which could contribute a certain agreed amount of money per week or per month. Thus informal women traders decided amongst themselves on how they wanted to use the money though bound by a constitution which stipulated written down rules and regulations. The group rules guided the operations of their schemes on certain aspects for example registration, contributions, benefits and code of conduct. Zheke (2010)’s practical experiences of an international agency Catholic Relief Services (CRS) confirmed that when the group is too big, the group members can be sub divided into smaller units of (6 to 20) members to manage their schemes efficiently and effectively. The grouping process was reported to be very simple as it does not need any paper work. The groups were small and structured after preliminary meetings were held to decide how many should be in a group and how much each member was to contribute per day, per week, per month or per year. Zheke affirmed that normally interested groups are invited to join the rounds or mukando based neither on their educational background nor economic status but instead based on characteristics such as trust, honesty, reliability, and punctuality, savings potential and locality and many more. Erstwhile studies show that once the group is structured, members decide on when to meet and how they want to share the generated profits basing on the group constitution. By pooling financial resources together, women improved sources of livelihoods which ultimately increased resilience to shocks such as illness, death in the family and medical bills. In the event that a member changed a place of residence from the particular flea market to another, this disqualified one from being a member as it was assumed that departing member joined the group where she was going to operate from. One IWT did not join whichever group but rather decided to do a self motivated scheme for the reasons best known to her. The woman constructed a self contribution strategy and at the end used the money to purchase items from foreign countries which she sold at the flea market. The informal woman trader had this to say;
“I decided not to join the group but rather to do it alone and every day I put aside a certain amount. On the first day, I put aside one dollar, the second two dollars, the third three dollars and so forth until the end of the month in which I raised USD460 dollars for myself. I used the money to order new items or for any other contingencies and for me this works very well” (Interview with the informal woman trader 20 June 2018).
The MCSs arrangements fostered motivation amongst women who seized the stage and decided to make a distinction in their lives. Mugabu (2012) aver that the provision of MCSs in such a measure is to reduce the burden of poverty among households in which interveners can support such schemes such as loan procedures and paperwork, combined with accounting experiences especially access to formal sources of credit.
Terms of Payment and Profit Sharing
The IWTs provide financial support to their members by providing short term loans (merry go round) to their members and if an individual requires long term help, the members were likely to consider that under a special arrangement. The money contributed by members was not kept in whichever bank account other than alternatively circulating within group members where terms of payment were stipulated. Women doing business at the flea market shared profits after every six months and sometimes give each other groceries for example salt, sugar, salt, cooking oil and soap. Whilst some members unveiled that they received less than $200 per term, the majority stated that they received above $500 more than the others which showed variances in their administration. One more member expressed that she was raising money to pay a hospital bill in the amount of (USD1 800) for her uncle who was diagnosed cancer. MCSs at this particular flea market proved successful as these proved to enhance livelihoods as income generated was reasonable, improved the living standards, and set standards in poverty eradication. The MCSs had managed to send their children to school, access health care, improved their living standards, pay monthly rentals on time, buy new stands, and one member articulated that she was able to purchase a motor vehicle. Such an experience is similar the Grameen Bank, (2012) study which confirmed that MCSs allow women to care for themselves and their families. A few women reported that they still struggled to pay back the loan in different terms. Thus, informal women traders found themselves paying back the mortgage through other sources apart from the benefits through tokens or gifts from relatives which even made it difficult to translate into loan interest. Figure 2 shows terms of payment by numbers.
Despite the provided details that some study participants failed to pay back the loan completely, others expressed that they were capable to pay back the loan although somewhat had failed to pay back on time. Those who failed to pay back on time were fined an agreed amount. Whereas some women paid the agreed amount every week, others paid back on a monthly basis and had not been charged any interest whilst others were charged interest. Some members were comfortable with the terms of payment; others were not and uttered dissatisfaction with the terms of payment. Hence quite a few members complained with regards to the amount of payment, time of payment and the amount of interest payable to the lender. The women borrowed the agreed amount used to pay back the loan with or without interest charged on them.
How Women used the Money Borrowed
The amount agreed upon was usually very small and this indicated refunds were small which could possibly make it difficult for them to pay back the loan on time. Figure 3 shows how IWTs used the amount of money borrowed from other group members;
The ways the borrowed money was used ranged from; buying and selling was reported (4) food stuffs (5) and bus fare expenses (5), property investments (3), education (2) and health care (1). These findings show that the highest was food staffs whereas the lowest was medical bills. Berhane of Action Aid (2009) concur indicating that more resources in the hands of women mean better health and education for the whole family, as women are likely to spend the money on schools and medicines for their children.
Reasons why Women Engaged in Micro Credit Schemes
Zimbabwe Poverty Report (2017: 54) confirm that in urban areas, poverty was highest among households that depended mostly on own business. Thus, informal women traders decided to provide capital to the marginalized women who were unable to access loans. Such schemes facilitated the IWTs to gain access and control of livelihoods resources to eradicate poverty where their opportunities proved very limited otherwise. With the loans they receive from microfinance groups, beneficiaries reported that they were able to invest in such businesses and secure distribution channels and start making more money on a consistent basis for survival and copings. Purohit, (2012) corroborate stating that informal women traders engage in MCSs for empowerment and as resolute pathways to eradicate poverty. Figure 4 shows the selected reasons why informal women traders engaged in micro credit schemes of that nature.
This study revealed that IWTs engaged in MCSs for various. Amongst them sharing risks was reported (10), to plan for the future (2), economic reasons (3), pulling resources together (3) and for sharing experiences (2). The mainstream IWTs conveyed that the main reasons why vast majority joined MCSs was to provide them with a base from which they could protect themselves against variety of contingencies by sharing risks and pooling resources together for poverty eradication.
Since forever, informal women traders did not qualify for traditional loans provided by various Commercial Banks and that's why vast majority decided to join the MCSs as sources of livelihoods and for poverty eradication. Most of the time, poor women have no collateral security and funds to pay back the loans. Thus many of the microenterprise owners were capable to begin enduring the stretching and thickening Poverty Datum Line (PDL). As IWTs did not have a protected way to save the money, with the MCSs fortunately, IWTs proved capable to keep hard cash circulating around other members in order to purchase certain items and sell them later.
Thus IWTs constantly showed interest in starting small scale businesses but indeed, this was difficult because of the country’s current socio economic turn down with a geographical picture of poverty in Harare Province pegged at 31.1 percent (ZPR, 2017). Hurtley et al (1990) corroborated emphasizing that it is popular these days to promote MCSs or to give grants which are likely to be more sustainable in the long run. The circumstances now permit an informal women trader to do so using their own initiatives and this helps them not only to realize their potential but instead to gain access and control over scarce resources as a pathway towards poverty eradication. Numerous IWTs realize that it pays to do business at flea markets and venture in MCSs which can protect them from migrating to neighbouring countries to do business in dangerous zones. SIDA’s Sustainable Livelihoods Approach advocates for policies, legislation whereas doing such business ventures in foreign countries where there is no framework in place to legally protect the IWTs would results in exposing them to social risky factors such as xenophobic attacks, HIV and AIDS, STIs among others. This is why SIDA (2001) indicates that there is need to access capital, livelihood strategies, and decision-making power through processes, such as policies, legislation. The involvement of women in MCSs leads to overall economic growth in drained countries as they acquire a steadier income which enables them to buy more products to sell and generate money for themselves for their livelihoods to eradicate poverty. Kofi Annan (2012) substantiate by contesting that MCSs is a wise investment in which women who are regarded as a minority group are able to venture into such initiatives even if they encounter social and economic challenges more than their female or male counterparts who are not part of the scheme.
Challenges Faced by Women in Poverty Eradication
The study found out that IWTs encountered numerous adversaries at the flea market. Mupambireyi's (2014) study reveals that those deposited involuntarily in the informal sector due to the Economic Structural Adjustment (ESAP) in the early 90 s are facing a raft of challenges among them, increased competition, depressed consumer demand and lack of proper working infrastructure Fig. 5 shows selected challenges experienced by IWTs for poverty eradication.
Women expressed that they faced challenges with regards to unpredictable weather patterns, harsh economic environment, lack of official legal binding scheme, lack of resources for them to enhance collaboration and networking with other women’s groups. All conveyed that they encountered challenges in paying back the loan. Some women communicated that in the first place, when they borrowed money from the group, they did not fully understand the permissible terms associated with the loans. Women received loans with good terms but did not understand the requirements because vast majority had taken the loan without complete information on how they were to repay back the loan.
Environmental conditions were some of the challenges encountered by women doing business at flea market. For example, women communicated that some of the items they sold at the flea market were seasonal such that those selling winter and summer clothes faced challenges due to change of weather from winter to summer and vise vesa which left them with abundant stock after each season. This though affected their business and ability to pay back the loan. There were no proper structures to secure their items during rainy season. A few women stated they were sometimes forced to close their stalls as they certainly did not have proper roof or building structures over their heads during either hot or rainy season and for them their business was a loss.
The other challenge encountered by IWTs included personal problems such as paying school fees, hospital bills and rent which had been some of the good excuse for them not being able to pay back the loan within a stipulated period. Thus personal problems such as sickness and death in the family had been cited as the major cause for not opening the business for some time. A few members disclosed that they closed their businesses for days, weeks or even months to recover from grief and bereavement after losing their dear ones. In those days, they could not sell or even join the scheme to gain profit in a meaningful way.
The study revealed that being in deficient of proper management expertise and misuse of funds were some of the challenges experienced by a few members who expressed that this actually affected their business. Some women were said to misuse the money for luxury items instead of generating profits for the business as well as pay back the loan on time. One woman always mentioned “personal" items which some of the group members regarded as misuse of funds. When the researchers probed further for clarification on this response the study participant was undecided to clarify what she meant by the word “personal”. There was lack of proper mechanisms to check-up on the proper use of funds amongst women micro-credit operators.
There was lack of subsidies, incentives and policy guidelines on MCSs for IWTs doing business at flea market towards poverty eradication which demonstrated that there were a few of the de-motivating factors. Several IWTs stated that when they tried to import goods for sale, occasionally these were confiscated at the border post or they faced hassles at the border post. Some IWTs additionally expressed that sometimes officials besieged a number of their goods demanding immigration declaration forms for some imported wares. IWTs uttered that in as much as they wanted to work according to the law and regulations but sometimes they were taken uninformed and as a result were forced to hide and not declare some of the goods. According to them, time and again, officials at border posts cashed on bribes from vendors who failed to prove that their wares had been officially declared at the country’s designated entry points.
When IWTs declare goods at the border, time and again it was not written anywhere that one should have kept safe declaration forms for future reference. Murwira (2012) dispute that some vendors imported goods in bulk and sold them at different flea markets across the country which made it difficult to keep the required declaration forms at all venues. Thus border post officials tend to note that deceptive vendors miss out declaration processes at each country’s entry points moreover depriving the state millions of dollars in revenue. Murwira (2012) points out that those officials would track them down and collect what is due to the state.