The performance of group enterprises supported by trading and credit : The case of Zambezi Development Trust Ltd. in Zambezi

Abstract

The practical attachment was conducted at Zambezi Development Trust (ZDT) in Zambezi district of North-Western Province from January to April 2003. ZDT is a Non Governmental Organisation (NGO) that works towards the improvement of living standards of the rural residents of Zambezi and Chavuma districts organized in groups. This is done through delivery of training in business management and provision of credit after training.Despite training and credit being provided to the groups, there was no corresponding increase in the business management skills of the group members. Besides, there was no significant increase in the income of enterprises supported by training and credit. The objectives of the attachment therefore welje: (i) To establish the reasons for the poor business management skills of the groups, (ii) identify problems surrounding the credit programme and (iii) strengthen communication between ZDT and the groups.In-depth interviews using interview guides were held with samples of group members that were trained and got credit. Focus group discussions were held with group members,members of staff and Trustees of ZDT. Direct observations were made on the training delivery and credit provision systems during the attachment. The student examined different group record books. Documents at ZDT and Z A Y O on credit and training were reviewed.Findings indicated that the group members' business management skills were not improved due to low levels of literacy as well as lack of training needs assessment of groups by ZDT. The training lacked adequate feedback mechanism from groups to ZDT. TTie motive of group members attending training was for them to access credit from ZAYO. The credit given to groups was at a very high interest rate such that groups failed to raise the incomes of their enterprises. Further, the loan amounts were too low for groups to venture into profitable businesses and improve their livelihoods. It was also established that there was serious lack of communication strategies or plans in both ZDT and ZAYO.On the basis of the findings, it was recommended that ZDT should without delay engage its target beneficiaries into training needs assessment. Training should be delivered on demand.ZDT should advise Z A Y O to revise the credit programme for it to meet the needs of the intended beneficiaries. Both ZDT and ZAYO should develop communication plans.