Association Between COSALO Savings Mobilization in Supporting Members’ Livelihood Activities and Economic Welfare: A Cross-Sectional Study of Church-Based Savings and Loan Groups in Siaya County, Kenya

Community-owned savings and loan (COSALO) groups involve regular savings by their members and the subsequent lending of the pooled resources for livelihood development purposes. Nonetheless, there is limited information on the role of the use of mobilized resources in improving members’ economic welfare in faith-based organizations. This cross-sectional study sought to determine the association between the utilization of mobilized resources for livelihood development and members’ perceived economic welfare. The study was conducted among 200 members of COSALO groups in the Anglican Diocese of Bondo, Siaya County, Kenya. Participants were members of a COSALO group with at least one year of membership. Data were collected using a structured, interviewer-administered questionnaire and included the perceived change in economic welfare on a five-point Likert scale and the characteristics of resource use. Associations between perceived change and each characteristic were defined using Pearson chi-square analyses (using Monte Carlo exact p-values due to sparse cells), Holm correction across the five primary tests and linear-by-linear trend analysis. Overall, 65.0% (95%CI: 58.2-71.3) of participants were aware that their economic welfare had improved either much better or better. Perceived change in economic welfare was linked with the main objective of resource use (V= .20; Holm-adjusted p= .032), the capital used (V= .20; Holm-adjusted p= .038) and the amount of proceeds which had been reinvested (V= .20; Holm-adjusted p= .042). For example, for those not reinvesting any of the proceeds, the share seeing an increase in economic welfare was 27%, compared with 87% for those reinvesting three-quarters or more of the proceeds. The frequency of resource use and support received in the form of technical or advisory services were not associated with change in economic welfare in the crude analysis. The results are limited by the purposive sampling, a cross-sectional design with no baseline measurement or a comparison group, a single self-reported measure of perceived change in welfare, and the lack of adjustments for confounders; thus, the results should be interpreted as associations rather than causal relationships. The findings indicate that pooled savings schemes like COSALO deserve consideration as a vehicle for providing livelihood support, particularly if resources mobilized are channeled into income-generating activities and reinvested; longitudinal studies with comparison groups are required to establish whether the associations are causal.

Community savings and loan groups, Savings mobilization, Economic welfare, Livelihoods, Kenya

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