Rotating Savings And Credit Associations (ROSCA)

A viable Financial Option

A Rotating Savings and Credit Association ROSCA (also known as a Pardner or Susu) can influence your finances in a positive way. What people like about Rotating Savings and Credit Associations is the fact that they are in control of their financial destiny.

So what is it all about?

How Does A Traditional Rotating Savings And Credit Association ROSCA Work?

The first thing you need to know is that a traditional ROSCA is informal. There are no written rules and you will not need to sign a contract. As such, if you encounter problems with a Rotating Savings and Credit Association, you may have very little legal recourse.

If you want to join a Rotating Savings and Credit Association you have 2 options. You can ask around among your friends or family and find out if one is being started or you can form one yourself.

Here Is How It works: A group of people, usually friends and family, decide to pool a specific sum of money into a fund. Usually, a person is chosen to collect the money. The person whose idea it was to start the Rotating Savings and Credit Association is usually the designated banker. The group usually decides how often they want to contribute and how often there will be lump-sum pay-outs.

Rotating Savings And Credit Associations Usually Make Monthly Or Weekly Payments.

The members of the association usually choose when they would like to receive their payment. The group leader or organiser collects the money from each member and gives it to the person whose turn it is to be paid.

This process is repeated for the rest of the cycle until every member is paid. If all goes well and all members were pleased with the process. Your group leader may run another cycle, allowing you to reap the benefits of the Rotating Savings and Credit Association again.

Are There Different Names For A Rotating Savings And Credit Association?

The answer is yes! You may have even come across a Rotating Savings and Credit Association ROSCA and not known it.
You may have heard it referred to by another name. Here is a list of the names you may come across depending on where you live or where your family is from:

Susu or Sou Sou – Africa, Caribbean
Pardner or Pardna – Jamaica, Caribbean
Partnerhand – United Kingdom
Paluwagan – Philippines
Pandeiros – Brazil
Cundinas – Mexico
Arisan – Indonesia
Ayuuto – Somalia
Tanomoshiko – Japan

These are just a few but there is usually a name for them in whatever country you live in.

Where Are Rotating Savings And Credit Association ROSCA Most Popular?

This informal savings system is prevalent in developing countries where most people may not have the means to access traditional financial facilities. However, they are becoming more popular in the developed world.

Are There Any Drawbacks To Traditional ROSCAs?

No system is perfect. So here are some things that you should consider if you are thinking of joining a Rotating Savings and Credit Association ROSCA.

1. Traditional ROSCAs do not pay interest. You basically get what you put in.

2. Your money or contribution is not insured. The members rely on the trust that in forged among members.

As you can tell Rotating Savings and Credit Associations are worth looking into if you want to start saving or if you need money for a short-term goal. You may be on the verge of changing your financial standing.

How Is Prosperity Pardner Different?

Unlike traditional Pardners, Susus and Rotating Savings and Credit Associations (ROSCAs), we pay you a reward for using our service.

Also we are not able to do the traditional rotational weekly or monthly payout, where each person receives a turn or ‘hand’.

Here’s why. Traditional Pardners and Susus depend on long established circles of trust, such as family members or work colleagues. The reason for the deep trust element is that 1 person is responsible for holding or safeguarding the money until it is paid out to the group members.

This is in addition to the fact that some people will receive their payout before they have paid anything!

We obviously cannot do that. We want to make our service as widely available as possible, which means we will be dealing with hundreds of people who we don’t know. It would be irresponsible of us to risk your money in that way.