Alou has created one of the most successful of Mali’s community managed village banking networks, providing savings, credit and banking facilities for village communities. Unique among other village finance offices, the input of capital from migrant workers in France allows the banks to strengthen villages which have been weakened by emigration and the ripple effects of rural poverty. One of Alou’s key innovations is a money transfer service for those living abroad which offers an effective response to the challenge of sending money home to remote villages.
Alou’s village banks (officially known as village finance offices or “caisses”) differ from many other microfinance establishments. They are the only financial institutions in the region of Kayes, Mali, that are completely managed by villagers and do not require a minimum amount of savings in order to qualify for credit. Alou’s Program for Self-managed Savings and Credit Systems (PASECA) is a banking system that preserves traditional elements of village life, such as participatory decision-making through village general assembly meetings and the honor system to aid in loan repayments. The banks also have a built-in community improvement mechanism and mandatory representation of women on their boards. One group of village banks, the first of its kind in Mali, is completely run and managed by women. Each bank is adapted to the needs of the particular community after basic training by Alou’s organization.
Alou’s village, Dembassala, which is located in the northwest of Mali along the border with Mauritania, was founded by his great grandfather. Two traditions meet at his birthplace: the semi-nomadic pastoralists from the north, and the sedentary cereal and groundnut farmers from the south. Conflict often arose between the two groups over the use of natural resources. As founders of the village, the Keitas were responsible for maintaining peaceful community relations, and Alou grew up absorbing stories and watching the elders of his family negotiate peace among the various groups. As a potential leader of the community, he was also diligently taught the values and techniques of community leadership and negotiation. Through this experience, Alou was convinced that participatory community decisions are the natural basis for economic development.
Alou became very knowledgeable about the various ethnic cultures of Mali. Time on his grandfather’s farm while on holiday from school in Bamako exposed him to agriculture and greatly influenced his choice of agro-economics as an area of study. Alou became the only one of his siblings to graduate high school and acquire a university degree.
Alou’s interest in financial management was spurred by his experiences living in a small town in Tunisia as a student at an agricultural college. He was living on a very tight budget. The requisite planning, discipline and budgeting that enabled him to survive his student years fueled his interest in financial management and micro-finance. An agro-economist by profession, Alou founded PASECA to help rural people from his village and surrounding communities develop economically.
