A Level 300 Student Product By Maud Amesigali
In spite of the growing number of member default and financial disagreements, many Ghanaians are still turning to Rotational Savings and Credit Associations (ROSCAs) also known as susu because they are more closer and convenient than the formal financial institutions. Although there are risks, contributors report that the system facilitates the settling of disputes within their groups without the need for long legal processes, thus making ROSCAs an attractive choice.
Many contributors comment that ROSCAs continue to be a significant source for financing school fees, business expansion, medical bills and for other individual needs. Some of the members have suffered losses when they defaulted, but they feel the advantages of regular savings and immediate access to lump sums are still greater than the disadvantages
Selina Akuffo , described her reasons for being in the system even though she did not like the system.
ROSCA organizers recognize that defaulting is one of the greatest difficulties in the informal savings groups. They said that prospective members are recommended by existing members, and then verified before being accepted into the group by following the group's rules. The measures are designed to help establish trust and minimise the risk of fraud, according to the organizers.
With these precautions, organizers report that some members "stop contributing after receiving their payouts. Organizers may sometimes fill in the missing contributions with their own funds in these situations in order to ensure that other members receive their expected contributions. One organizer explained that they make every effort to keep protecting each member as it's all about trust and that's what ROSCA is all about.
Yaw Boampong Adu-Brimpong ESQ is a financial experts who suggest that people who are interested in joining need to understand how a ROSCA works before they join. They suggest questions concerning the requirements for membership, record-keeping and for the procedure to follow should a default occur. These can assist members to make informed choices and minimise financial loss, they say.
ROSCAs continue to serve as an important financial lifeline for many Ghanaians who are unable to access formal credit. Contributors recognize the potential of dangers that exist with the ROSCAs, but they feel that more accountability, transparency, and trust will make the ROSCAs a viable community-based savings tool.
Interesting
ReplyDeleteHere's a version that captures the depth of the first one in simpler language:
ReplyDeleteROSCAs shows that, trust and community matter more than banks for many Ghanaians. Even with some challenges involved, the system works because members hold each other accountable and resolve disputes together in order to promote peace and unity.
Susu remains a valuable financial tool for many communities. However, members should understand the rules, ensure proper documentation, and join trustworthy groups to reduce the risk of defaults and financial loss… But anyways i think what the woman said in the video is very true😂😂
ReplyDeleteROSCA is fast and easy but very risky. I think these women needs to be educated more on where to save their money
ReplyDeleteEven though Rosca is risky , people still choose it because according to some people, they don’t even understand why they have to go form queues in the bank for their own money !
ReplyDeleteInteresting piece
These market women needs to normalize saving their money at the bank.
ReplyDeleteROSCA has been an old system, especially for market women, where they save their money, and it's also the easiest way to cash out your money with no stress, unlike queuing at the bank. But it is also highly risky to lose your money. People need to be educated because you can lose your money without a trace with ROSCA.
ReplyDeleteI actually second to whatever the woman said 🤣🤣
ReplyDeleteFor a long time, people have believed it's a safe way to keep their monies. Subconsciously, they are not really triggered by the increased rates because, for a long period of time, they have trusted it enough.
ReplyDeleteThe stress of going to a bank, being in a queue and later doing a lot of paperwork just to safe guard their monies, the ROSCAs approach is convenient and they do "all the work" for them
ReplyDeleteTill date, I still try to process why our market mothers prefer ROSCAs to our bank systems.
ReplyDeleteWe understand ROSCAs gives easy access to our money but is there no other way to educate our mothers on the consequences it comes with?
ReplyDeleteI think the Susu within trusted individuals is the best .But it doesn’t mean anyone should joke with my money oo
ReplyDeleteROSCA is fast and easy but very risky. I think these women needs to be thought more on where to save their money and get access to their savings history.
ReplyDelete