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Roscas and Microcredit Lending

            For people who cannot access modern saving methods, it is easier to depend on fellow community members to make an income or to have money to supplement certain needs which would otherwise not be satisfied. There are other ways of saving money or investing it rather than the modern way of using banks and investment companies. Organisations such as micro lending and Roscas make it possible for people in mostly third world countries save their money. There are significant similarities between Roscas and microcredit lending schemes. They both cater for poor people, especially women, and organise them into groups that will benefit everyone mutually. They mostly focus on lending money and saving is also included. These two forms of organisation involve paying a certain amount of money into a fund that is accessible to everyone periodically. The dependence on peer pressure enables the sustenance of participation and avoids default by members. These forms of saving on a local scale could be compared to Stokvels where, mostly women in rural or poor communities, put money in a communal fund that is accessible to all members in times of need. This fund could be for a funeral, groceries and to supplement incomes to name but a few. .
             Microcredit arrangements are likely to work well in environments that match in central ways the situational logic of rosca settings. In social worlds where groups are important organizers of experience and movement, where obligations are collective, and where other sources of identity and mobility are not present or controlled, microcredit offers an important tool for poverty alleviation. It is not enough to have the same social setting characteristics although it is very important that people of the same social status are recruited, who are organized with others with whom they have, or come to have, a social bond and basis of reciprocated obligation, and who have faith in the everyday and honourable integrity of fellow peer group members.

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