Highlighting noteworthy publications and resources on Savings Groups
Savings groups provide informal but organized mechanisms for people to save. Groups are typically formed with assistance from an external party and operate independently after approximately one year of training. These groups aim to provide a safe, convenient place to save, offer ready access to small loans, and a small insurance fund. Each member decides how much she can save each week and contributes it to the core group fund. Group members lend to each other at interest rates they decide on collectively, thus generating an accumulating capital sum made up of member savings, interest, fines for missing payments, and late fees. The accumulated capital is distributed to members at the end of each cycle in proportion to the members’ respective contributions to the fund. Since the group fund is financed entirely by tapping the savings of the group members, there is no external loan fund to manage and oversee.