Where would you put your money if there weren’t banks? How would you save money and how would you take out a loan?

The answer for many people is to use a “rotating savings and credit association” known as a ROSCA.

Intrigued as to what a ROSCA is and how it can help you save money? Let’s find out.

What Is a ROSCA?

Though you may never have heard of it, the concept of a ROSCA has been around for several hundred years and is used by millions of people the world over. This paper from Ohio State University states that evidence of their existence has been documented as far back as 1275 A.D. in Japan.

A staple in most communities outside the western world, even many immigrant communities within the U.S. have active ROSCA groups.

The basic idea is this: a group of people get together and decide to make set contributions for a set period of time. Meetings are held on a regular basis where each person brings their contribution and the money is pooled together. At each meeting, the entire collected sum is dispersed to one member until each member has received the sum once.

Once the cycle has finished, members can decide to begin a new round with the same terms, modify the terms, or disband the ROSCA altogether.

In short, ROSCAs allow people to better manage their finances without having to pay fees to a bank. The person who receives the lump sum at the beginning of the rotation basically gets an interest-free loan and the person at the end gets the benefit of an obligatory savings plan.

Contributions can be small or large and the frequency of the payouts can vary significantly, although monthly is common. The length of the cycle can also vary, though they tend to be somewhat short — perhaps 6 months to a year. That’s the beauty of ROSCAs, they can be customized to perfectly fit the needs of its members.

Save Money in Community

ROSCAs are known by different names as communities all over the world have named them in their native language. For example, they can be called a junta or pandero in Peru, a gameya in Egypt, a consorcios in Brazil, or a susu in West Africa and the Caribbean.

Of course, for this system to work, the people participating have to be trustworthy individuals. For this reason, ROSCAs typically appear in tight-knit communities or within large families. One person is chosen to oversee gathering and dispersing the money. Most meetings are held in person and community pressure is strong to meet one’s obligations. Those who don’t may be ostracized.

ROSCAs often come with a strong social element. For example, the person receiving the money for that period may host the meeting (and dinner) at their house.

ROSCAs in the Modern World

So, with technology and more sophisticated ways of banking, do ROSCAs have a place in the modern world?


Mobile banking and technology allow people easy access to their money. This is a great thing — except for those who have trouble saving. Joining a money pool is an excellent way to keep your savings plans on track. You can’t spend money if you don’t have it!

Then, when you get your payout, you’ll get the lump sum you need to meet your goals. You might not be able to do much with $200, but with $1,000 pooled together in a group of 15 people, you’ve got something to work with.

To facilitate this idea, we’ve developed a system that allows you to save money with a convenient online money pool. You can create a pool with friends or family to help each other save towards your goals. Use your payout to buy a car, pay for a vacation, fund college, and more!

Don’t know anyone who wants to join a money pool? You can join one of our public pools. Just choose one with the terms that best suit your needs.

Saving with a ROSCA

Getting started is easy, simply visit us here at PoolSpark. Organizing a money pool in your community may be difficult to get up and running, but our platform makes it simple.

It’s no wonder this method of savings has worked for hundreds of years. It gives people the financial flexibility they need when they’re just barely scraping by. Plus, it allows others to participate in a savings plan knowing they are helping provide others with opportunities.

Intrigued? Start your money pool today!