You can't save alone: Commitment in rotating savings and credit associations in Kenya

A study was performed to examine the reasons why individuals develop and maintain local-level financial savings organizations known as rotating savings and credit organizations (Roscas). Data included Rosca participation and design from a sample of 70 Roscas and 1,066 Rosca participants in rural Kenya. The Roscas, located in Busia and Teso districts in western Kenya, were all run by local women's self-help groups. Data were analyzed focusing on Rosca participation and household conflict, Rosca design and self-reported rationales for participation, commitment and Rosca design and alternative rationales for participation and design. It was confirmed that individual or household needs for commitment in the face of savings self-control problems can form a rationale for Rosca participation and design. Overall, it was observed that the ability to fulfill simultaneous needs may explain the popularity and durability of Roscas and the adaptability of Rosca design may explain why different forms of Roscas abound across different institutional and social settings.