Facts About Savings Groups in Africa

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Written by Jamborow on 1 December 2021.

In simple terms, Savings groups are self-help organizations in which a group of people stock savings and offer loans to their own members. They are very popular across Africa and are seen as necessary alternatives to formal financial institutions. In this article, we would be listing some facts to note about Savings groups in Africa and below are Fifteen of such facts.

  1. It’s a member-based financial institution which operates on co-operative values, identity, and principles.
  2. Rates of adult savings group participation are 37% in Uganda, while participation rates in Kenya, Nigeria, and Tanzania are 13%, 12%, and 16%, respectively.
  3. In Africa, there are about 20 million active members in Savings Groups, supported by hundreds of local and international development organizations.
  4. According to the SAVIX 2019 publication on Savings groups, about 80 percent of Savings Group members are women worldwide.
  5. Women are more likely to participate in savings groups than men in Kenya, Tanzania, and Uganda . The gender difference ranges from 5.1 to 8.0 percentage points, depending on the country.
  6. Uganda reports the highest proportion of women participating in savings groups, at 39%.
  7. In Kenya, SACCOs have around 14 million members with more than Sh732 billion in deposits and more than Sh1 trillion in assets. Likewise in Uganda, there are more than 16,500 co-operative societies registered in the country.
  8. Ethiopia saw a surge in the number of SACCOs in their country from 26,672 in 2009 to a whopping 53,982 by the end of 2014. The annual growth in these five years was recorded to be at 17 percent.
  9. Digitizing Savings groups makes transactions simpler, paperless, and more transparent. It cuts costs for the groups while expanding the target segment to people.
  10. Based on the National Bureau of Statistics. (2013). Use of Financial Services in Nigeria. Abuja: NBS & World Bank report, Nigerian women are more likely to use esusu as an informal means of saving than are men.
  11. Esusu dates back to the 16th century when it was carried by Yoruba slaves to the Caribbean, and from there, eventually, by immigrants to most North American cities.
  12. Evidence suggests that savings groups provide a number of modest economic benefits to their members.
  13. In Uganda, the savings group participation rate for rural individuals is 39%, as compared to 29% for urban individuals.
  14. According to the Gates Foundation report, most of the women’s saving groups that made it through the peak of the Pandemic were able to do so due to digitization.
  15. In terms of sustainability, 80% of businesses started through one of the savings groups called VICOBA, are still in operation after three years.

Jamborow has the capacity to automate the records of Savings groups, with our AI and blockchain technology, we create proprietary credit scoring algorithms for our users, this gives them the credit footprint, data visibility they need to access more funds and makes running their operations more effectively as well as efficiently.