VSLA-CHILD is boosting farmers’ access to finance and tackling the roots of child labour

36-year-old Comfort Agoloso is a cocoa farmer from Akuapim, in the Mankranso cocoa district in Ghana. Comfort is also a VSLA-CHILD group member. VSLAs are Village Savings and Loan Associations where group members get together to collectively save money, simultaneously providing each other with access to small loans. Comfort used her first loan from the group to pay school fees for her eight children.

Over the past decade, there has been an increase in chocolate companies committing to sourcing 100% sustainable cocoa in orderto improve livelihoods for cocoa farmers and to help eradicate child labour from the cocoa supply chain. Sustainability projects are being up-scaled rapidly, and substantial steps have been made by various organizations in implementing Child Labour Monitoring and Remediation Systems (CLMRS). Unfortunately, child labour remains rampant despite industry efforts. The expansion of CLMRS in cocoa is an important and essential process, but also has its pitfalls. Indeed, costlier individual household monitoring systems come with a financial trade-off for prevention and remediation activities, and the remediation of individual cases places focus on short-term solutions such as the provision of school kits and birth certificates. While these activities are effective and make real change in many children’s lives, the challenge is finding a balance between monitoring, remediation and crucial structural changes that can be put in place to address the systemic and complex nature of child labour.

Beyond Beans, the sustainability foundation of ETG, has worked with Participatory Development Associates (PDA) and other local partners in Ghana to develop a way in which to do this at the grassroots level. With our program VSLA-CHILD – a programme that incorporates a child protection module into VSLA groups - the goal is to use a bottom-up, cost-efficient, and community-driven approach that addresses the underlying drivers of child labor in the cocoa sector, building on the proven VSLA and GALS methods. The approach has a focus on income-generating activities, awareness raising, and gender equality at the household level. So far, we have started up 100 VSLA-CHILD groups with 2,446 members (of which 1,438 women). The majority of members are trained in gender equality and have been sensitized on child labour and how to combat it within their own households and communities. We estimate that this has affected roughly 8,300 children.

Comfort Agoloso has greatly benefited from VSLA-CHILD's activities, as she has used her loan to give her children access to an education and to begin her own income-generating activity: “I was able to buy my children school uniforms and footwear, and when I repaid my initial loan I requested for another loan, which I used to start a petty trading business.” Now, proceeds from the petty trading go towards her weekly share purchases, and she plans to use the money from the share-out ceremony to further expand her business and take care of her family.

Comfort advocates for VSLA-CHILD and its benefits for children and their right to an education: "I encourage my colleagues to be serious with the group because it will help us to get a better future for our children." She is just one example of the impact that VSLA-CHILD has on structural poverty and children’s lives.

So, how exactly does VSLA-CHILD work?

Given the interlinking nature of child labour with structural poverty and gender inequality, among other issues, tackling it requires a multi-faceted, context-specific approach that can create impact in a multitude of ways. Such an approach needs to include supporting household financial capacity-building to increase and diversify incomes for farmers, empowering women, providing access to opportunities for children and young people, and monitoring progress all the way through.

VSLA-CHILD consists of three core elements that build on each other. Together, these elements are designed to create bottom-up community-based impact through improving access to finance, empowering women, and addressing the root causes of child labour.

The table below explains these components and how they positively impact structural poverty and thus can reduce child labour:

So, what exactly have we achieved so far?

Across our communities, 100 VSLA groups have incorporated the CHILD module, with 2,446 community members involved. Across our VSLA-CHILD groups, a first estimated 1,606,469 GHS (239,771 EUR) has been collectively saved by group members over the past 14 months, and 1,500 members have taken out a total of 2,571 loans, with 64% of loan beneficiaries being women. The average loan amount is 570 GHS (85 EUR), and members use these loans for side businesses (68%) and farm management activities (20%), generating additional income, building entrepreneurial skills, and reducing their dependence on cocoa. We know that VSLA members can be reluctant to take risks in the first year of a group’s operation as they wait to see if the system works, so we expect both the number and amount of loans to increase as groups begin a new savings cycle.

At Beyond Beans, we have set out to run household surveys to quantify the module’s efficiency on child labour remediation during the first three years of VSLA-CHILD pilots, but our main goal is to establish scalable and self-sustaining structures that secure long-term remediation. The VSLA groups provide a strong platform where child labour can be discussed both at the community and household level, and by combining this intervention with a sample-based household monitoring framework we eventually aim for a healthier balance between monitoring costs and remediation investments.

We are proud to support farmers such as Comfort Agoloso in working towards building more resilient communities and a better world for their children.