Posted August 2000
Saving groups occur frequently and have a long history in Africa.34 While they proliferate in contexts where financial systems are not well developed, saving groups are very much a common sight in urban as in rural areas.35 Whereas their prevalence is now common knowledge in Africa, there is still a lack of understanding as to what exactly these groups are and the functions they play in mobilizing savings. This chapter is about saving groups. It seeks to unravel what savings associations are, why people join them and the impact they have on the lives of savers. The chapter's main argument, which is preliminary, is that saving groups are informal institutions for saving which people form or join in order to achieve two related objectives, namely protect their wealth from competing people or groups and mobilize savings for their own future use. These institutions arise in contexts where formal saving institutions are absent or inadequate.
Within the district, informal savings associations are known by many names. In the village, there are variously known as 'chikande' chikande-kande or chiraundi. The practice derive from an ancient celebratory practice where members used to 'pass' or 'drop' kandira gifts in the plate of a new and unexpected 'celebrity'. Some villagers say it refers to the old practice where villagers used to exchange kandirana gifts or valuables. Whatever its origins, the term is now used to denote ad hoc rotational saving activities. Where savings are collected from group members in a single round and they are awarded to one member of the group based on mutually agreed upon rotation formula.
In the village, saving groups fall into three types, each specialising in a different area. The first type is where members agree to give each other goods. In one 8-member group I am familiar with, members contribute pots to each person. This Pots Group, as I shall refer to it throughout the chapter, agreed that contributed pots be of the same size and quality.
The second type is where members give cash to each other. One group made up of 10 women gave each other 500 dollars on a monthly basis. This Women Cash Group, as it shall be called in the chapter originally paid 400 dollars to each other. A burial savings group, Denga, required 200 dollars.
The last type is a compromise of the two above. This is where each member has a chance to receive both goods and cash. Members of one 12-member group I am familiar with, The Beer Group, gave each member the chance to brew beer and sell it to members at an exorbitant price. In addition to this the member received 250 dollars from others. A 6-member women's group, the Nzanga, gave each member a pot plus 500 dollars in cash.
There are three different ways to kick-start the rotation or to determine how and when members receive their share. In the first formula, a list of all participating members is drawn randomly. The list may be memorised as was the case in the Pots Group. In some cases, however, the agreed list is formally written (usually in an old exercise book). In either case, the person who heads the written or memorised list becomes the first to receive contribution, followed by the second, and so on, in that order.
In the second rotational model, the members may agree to follow the order based on seniority considerations. Age is not a determinant of seniority and the youngest person who occupies a higher kinship position may well end up being the first over old women in the group. In the Nzanga group the fist person to receive benefits was Ms. Hove, because she occupied a higher position in the kinship structure.
The third rotational formulae involves members drawing up a list of all participating members. A geographical or settlement consideration is then applied to determine the first recipient. The Beer Group agreed to start with the person settled on the northern end of the lineal village as the first recipient and ending with the last member located in the far south.
The fourth and final rotational formula is a pragmatic one. Members agree to start with the member who needs the goods/cash urgently. Ms. Mweye, whose disbanded group specialised in kitchenware, became the first beneficiary because she expected visitors and had an impending important ceremony which required the use of additional pots. Within the village, its is recommended that visitors, particularly one's in-laws, be served in new or rarely-used kitchen utensils.
These rotational formulae are ideal and many people and groups try to abide by them. However practical considerations sometimes interfere with the plans and intentions of the group and this may result, though not always, in the modification of distribution procedures. I shall give two examples.
Mr. Chikwambu, a member of the Beer group lives near the northern end of the village. According to the rule of the group, he would have been the second person to be the beneficiary. However, Mr. Koki who is located at the southern end of the village took his (Mr. Chikwambu) turn, the reason being that he needed the money urgently for school fees. 'We thought that was not fair, but what can you do when one of you says he is in trouble?' remarked a member of the group.
The second and similar case relates to Ms. Tano, a member of a women's saving group whom all members had agreed that she be the seventh to receive the benefits of the group, became the third because she had a great event lined up and needed new pots. While they protested at first, other women of the group granted her wish. As in the case of Chikwambu, members consented not for the mere fact that their friend was in trouble, although this certainly was part of the reason. They did so because they value harmony in the group and did not want to disrupt an institution which they felt advanced their saving interests. As Ms. Hove remarked, 'We want the group to work, and so we agree to dissenting voices.'
I shall end this section with a comment. While groups do not always follow their stated rules of procedures, it is noteworthy that they have these. It is very likely that these procedures of operation are meant to rationalize, enhance and expedite the mobilization of savings among participants.
First are those groups which draw up members from the same neighborhood. The Pots group draws members from the same neighborhood. Members' homesteads are packed together and make a distinct cluster in relation to the whole village. The longest distance between the homesteads, which are demarcated by strips of vegetation, is less than 300 metres. So close are the homesteads to each other that the whole place is referred to by any one of the names of the households. Children play and sometimes eat from the same plate, even though the different households say its not proper.
Members who join neighborhood-based groups do so because it is the most sensible and efficient way of mobilizing savings. All members are in one place and there are no additional costs needed to contact one another. Also no time is spent mobilising members for meetings, if any.
Secondly, there are those associations that draw their members from the same kin group. A good example is that one member of the Denga family which banded together to form a burial society. The purpose of the society is to mobilize savings for death related purposes. The members of the group, who share common descent in a very minimal sense, do not all share the same residence although some do. One of the members lives 10 kilometers away from the core group.
Kinship based-groups are regarded, by their membership, as a good strategy of mobilizing savings. Members of the burial group say that as descendents of a common parent they trust one another and do not always fight, as is the case with other groups, that are differently organized. In practice the group members fight. At the time of research the group was internally divided and there was frequent exchange of witchcraft accusations. 'This group', mused the village-head when he failed to reconcile the siblings who accused each other of witchcraft, 'is a puzzle and wonder.'
The third group draws its members from the same religious base. The Nzanga group is made up of members who share the same religion, Roman Catholicism. As in the case with the Denga burial society, Nzanga group members do not share the same residential area. Some of the members of the group come from a nearby village, and most are scattered all over the village. It is not by accident that many join to form such a group. For them, the common faith and belief offer a framework of cooperation and conflict resolution, two ingredients required in successful mobilization of savings. 'When we have disputes', remarked Ms. Hove the founder of the group, 'We solve them harmoniously and quickly, leaving us to concentrate on savings mobilization.'
These then are the variety of saving groups found in the village. They are multiple and varied. We may understand this multiplicity as a reflection of the uniqueness of individuals and groups found in the village. Also it can be argued that the multiplicity reflects the widespread interest in saving to all people wherever they are located.
Sometimes these saving groups have an organizational base or center. One savings group, that has since disbanded, periodically met at the home of one of the members. Similarly the burial group met at the home of the oldest member of the kingroup. However, the senior and oldest member of the group has since died, and it is not clear whether his next brother will transform his home into a meeting place for the group. I do not have data to say why some groups prefer to have a formal meeting place. What we can say with some confidence is that the practice of having an official meeting place provides the saving group with sobriety and seriousness, both factors that facilitate savings. 'Our husbands' remarked a member of the disbanded group, 'understood that we were not going to some other place but doing something organized and serious. They therefore permitted us to continue with our group.'
Other groups, and these form the majority, do not have a formal base. Members take turns to meet at each other's homestead. The Beer group meets at the home of the member with a turn to brew beer. Alternatively the group may combine their activity with others in the village, meeting for instance after church. The Catholic group took advantage of their church meetings, convening as a group, after Mass, to discuss savings issues. In many cases, however, groups do not even formally meet, once they agree on how the contributions should proceed. The Pots Group did not have a place to meet and members devised their own strategies to ensure that their contribution reached the month's beneficiaries. Some members made use of their children to relay goods to the beneficiaries.
Most members operate loosely without a base possibly because they fear threatening the egalitarian nature of the associations by having one. Choosing a member's home as a venue carries with it the danger of elevating the host, and it is possible that members do not like this. Members are possibly aware that cooperation in the matter of saving works best where members remain equal or continue to think that they are equal.
While not many, some groups are formally organized in the sense of having a leader. The burial society mentioned above is a good example. The group has a sachigaro or mukuru (the one that sits on the chair or mukuru (elder). There is also mubati wehomwe (the one who keeps the money bag); munyori, ( the secretary or scribe) and vabetsere (committee members or the helpers). One important point is that all office holders are old people because people say young people cannot be trusted with power. Young people dismiss this as nhema hombe (big lies). 'We are' remarked one frustrated young man when asked what he thought about the reasons for this gerontocracy, 'tiri vana shefu kumabasa' (We have responsible positions, big offices and servants who serve us with tea.'
Another point to make is that all office bearers have some prior authority within the kinship structure. The leader of the group used to and still takes lead responsibilities in kinship matters. It is likely that this form of arrangement whereby only old people and experienced leaders head the group is meant to enhance as much as to ensure that the savings mobilization process does not flounder.
Other groups are not organized in the sense of having a political structure. The Beer group and the Pots Group have no formal organization. Discussions are generally democratic with each member taking turns to speak or more usually speaking at the same time until a consensus is reached. When there is a deadlock, the voice and view of the most respected person (usually one who rarely speaks) is adopted. When Pots Group members protested against the request by Ms. Tano to be given priority in accessing the fund, in contrast to what had been agreed upon, Ms. Moyo, the soft-spoken member, encouraged other women 'to sympathize with those who are facing problems.' Her view was adopted and Ms. Tano became an early beneficiary. Members say that they like it without political structures. 'Leaders are the ones who kill groups when they are corrupted by power', remarked Ms. Moyo of the Pots Group.
Finally other groups have a combination of both. The Nzanga generally treated Ms. Hove as 'an important' person in the group. Ms. Hove was not elected to this position. Since she had a that having a higher kinship position and also having introduced the idea to the group it was proper that Ms. Hove should be an important person in the group. Though not elected, Ms. Hove is able to exercise some leadership functions. She called meetings and suggested new levels/amounts of contribution.
Clearly there are various organizational frameworks present in the village. These frameworks accurately reflect the circumstances and aspirations of people. Which would suggest, in a preliminary way, that savings programmes will only work when their organization is based on the aspiration of the people rather than those of the state or non governmental organizations.
Saving groups come about because people want to acquire additional resources for future use. They are an answer to the scarcity of resources that people face on a daily basis. The Pots Group, of which Ms. Tano is a member, arose because women needed new pots. Many women were convinced that on their own they could not buy so many pots at least within their required time frame.
Saving groups also arise because people want to hide money from other competing claims. Women say saving groups allow them to hide money not from thieves but from their husbands whom they say need the money for drinking purposes. Women, as the remark from a savings group member shows, are aware that hiding money in nappy bags, baby boots, clothes only work to a certain point:
For such women, joining a savings club becomes a convincing and legitimate excuse to hide money from husbands even though this does not always work. I was told, during fieldwork, of one woman whose 'husband demanded that she hand over all her monthly benefits because she was his wife. Similarly, I was told of another incident in which a wife was questioned for pretending that she had no money when she had some 'to pay for chikandekande.' These cases are, however, rare and most women interviewed say that husbands are very supportive of the chikandekande.
Other people join saving groups in order to hide their wealth from kinsmen and friends. Ms. Moyo of the Pots Group, said it was only after joining a savings group that she got respite from her demanding kinsmen. 'They kept on,' remarked Ms. Moyo with some relief, 'coming to borrow money which they never paid back to me'. Similarly, Mr. Chikwambu said that, after joining a saving group, he is able to prevent his money from passing into the hands of demanding relatives. 'My remark to brothers who wanted my money' said Chikwambu, 'is that all my money is now accounted for.' However, it is important to note that this 'redemption' of the saver is only achieved at the expense of the kin group. One of Ms. Hove's relative complained that 'she no longer cares for the welfare of her own people other than those of the Nzanga.' The situation is the same with Chikwambu who is thought by his relatives as 'insane'. 'Ever since he joined this saving groups' remarked his brother Hori, 'he no longer gives money to his own people. We will see where he goes when he gets into trouble.'
This chapter has looked at savings and the factors that give rise to it. It has shown that saving groups are associations formed by people sharing some common attributes. They may be from the same neighborhood, kinship or history. In an environment where there are limited alternatives, such associations become one of the mechanisms through which people are able to legitimately mobilize savings for their own future use. In the next chapter, I examine another strategy, this time cultural, that is adopted by rural people to mobilize the saving and support from their own communities and neighbors.
Saving to death: Chapter 1 | Chapter 2 | Chapter 3 | Chapter 4 | Chapter 5 | Chapter 6 | Chapter 7 | Chapter 8 | Chapter 9 | Chapter 10 | Chapter 11 | Bibliography
 
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