SomReP Village Banking Model in Rural Communities In Sanaag Region - Scaling Women Economic Empowerment through Financial Market Systems
In the heart of Somalia's Sanaag region, where formal financial services are absent, SomReP has pioneered a transformative solution—the village banking model. This innovative approach, supported by Oxfam through the Australian NGO Cooperation Program (ANCP) funded by the Australian Government, Department of Foreign Affairs and Trade, is revolutionizing financial inclusion and empowering rural women to lead sustainable economic change.
A recent visit to TAYO community bank in Garadag by SomRep technical team and OXFAM to check on their progress
For the first time, the Somali Resilience Programme (SomReP) established a community banking model in Garadag and Ceel Afweyne located in Sanaag Region, providing vital financial access to economically active yet vulnerable populations. With no traditional banks or microfinance institutions available, the creation of the TAYO community bank has filled a critical gap pooling together Village savings and loan associations (VSLAs), Meat and Milk Associations and pooled their savings to build a strong capital base to offer loans to local entrepreneurs.
A Model Led by Women, Rooted in Inclusivity
One of the most remarkable aspects of TAYO is its governance structure. Managed by women and guided by a Sharia-compliant board, the bank ensures that all loan products are compliant. To strengthen operations, TAYO's leadership received training in credit risk management, governance, and day-to-day administration, supported by operational manuals and official registration with the relevant government ministry.
At its core, the village banking model prioritizes inclusivity. Historically, rural communities have faced barriers to accessing formal financial services due to a lack of collateral, credit history, and even basic awareness of financial products. Through SomReP, TAYO community bank has been assisted to develop three market driven products including a loan product for people living with disabilities (PLWDs). This commitment to inclusivity is empowering women who were once marginalized to start and grow businesses, such as milk production, live animal trade, butcheries, small shops, and agricultural ventures.
Transforming Lives and Strengthening Communities
The impact of the TAYO community bank extends beyond financial access. It fosters collaboration and trust among members, building a robust support network that transcends financial transactions. As their incomes rise, community members can now invest in improving their businesses and livelihoods. Entrepreneurs can access funds to expand milk and meat markets and other Micro and Small Enterprises (MSEs), unlocking new economic opportunities.
Looking ahead, TAYO community bank members aim to scale their impact by forming a Cooperative Society. This market-driven model will enable them to benefit from joint marketing, product aggregation, and collective advocacy. By fostering sustainable economic development, SomReP's village banking model is not only transforming individual lives but also strengthening the resilience of entire communities.
A Vision for the Future
The success of TAYO demonstrates the power of community-led financial solutions in driving sustainable development. SomReP remains committed to expanding this model across Somalia, particularly in regions lacking formal financial services. Future plans include transforming TAYO into a fully-fledged microfinance institution capable of serving diverse market segments.
By empowering rural communities through inclusive financial systems, SomReP is paving the way for long-term economic independence and social cohesion. The village banking model in Garadag and Ceel Afweyne stands as a testament to the transformative potential of community-driven innovation, inspiring hope and opportunity for generations to come.