An investigation of the Sustainability of Village Savings and Loans Associations (VSLAs) amidst Covid-19 and its impact on household income levels: lessons from Malawi, Sub-Saharan Africa.

ABSTRACT

BACKGROUND: Food security, malnutrition, and poverty are some of the challenges that most of the sub-Saharan African countries have been historically facing. With the coming of Covid-19 pandemic, the sustainability of the Village Savings and Loans Association which are formed to counter fight these challenges is questioned. AIM: This study aimed to assess factors associated with the Sustainability of VSLAs amidst Covid-19 and its impacts on households' income levels. METHODS: An online cross-sectional design was conducted from November to January 2021, targeting VSLAs members in Mzuzu. A snowball and respondent-driven sampling technique were used to recruit the needful participants using a referral approach. IBM SPSS version 23 was used to perform descriptive statistics, Chi-Square, and binary logistic regression with unstandardized Beta (ß), Odds Ratios (OR), and 95% Confidence Interval (CI) being taken into account with P-value set at 0.1, 0.05 and 0.01 significance levels. RESULTS: Our study finds that household income declined by 54% for those earnings belonged to ˂ MK5,000, as compared to 38% and 15% for medium (MK5,000 ≥ MK10,000) and higher (> MK10,000) income bands respectively. Our study shows that gender (ß = 0.437, p = 0.094), age-group (ß = 1.317, p = 0.000), education (ß = 2.181, p = 0.047), share contributions (ß = 1.035, p = 0.008), meetings (ß = 0.572, p = 0.021), occupation (ß = -0.453, p = 0.106), and frequency of meeting (ß = -0.507, p = 0.049) were positively and negatively statistically significant predictors. CONCLUSION: According to the findings of this study, households with lower income earners, which is one of the indicators of poverty, are more affected by the pandemic than their counterparts. We urge that the Malawi governments should maintain and, if they haven't already, implement programs that support low-income households, such as transfer payments, which have been shown to uplift people out of income poverty in many developing countries.