What are ROSCAs?
Rotating Savings and Credit Associations (ROSCAs) are informal financial cooperatives where groups of individuals contribute fixed amounts regularly to a common fund. Members take turns receiving the entire pooled amount, creating a rotating credit system that provides access to larger sums of money without traditional banking requirements.
Core Characteristics
- • Fixed, regular contributions from all members
- • Rotating payout system ensuring fair distribution
- • Trust-based community membership
- • No interest charges or traditional banking requirements
- • Social and financial support network
Global Impact
- • Serving 1+ billion people worldwide
- • Critical for unbanked populations
- • Supporting microenterprise development
- • Empowering women’s economic participation
- • Preserving cultural financial traditions
How Traditional ROSCAs Work
Group Formation
8-20 trusted members agree to participate
Regular Contributions
Fixed amounts collected weekly/monthly
Rotating Payouts
Members take turns receiving full amount
Cycle Completion
Process continues until all receive payouts
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