On the Saf(v)e Side – Informal Saving and Insurance Institutions in Africa and Its Diaspora
Informal economic institutions such as saving and insurance institutions were described by Clifford Geertz as useful only for an intermediate stage of development in 1962. He believed they would fade away and be replaced once developed financial institutions are available. Today – although the formal financial sector has developed and spread immensely worldwide – such informal economic institutions are as vivid as ever. While in the past informal institutions have been associated with rural, poor, and female populations, who had less access to formal financial institutions, more recent research showed that informal saving and insurance institutions are as well popular amongst successful and urban elites. Members of such institutions cover all socio-economic classes in their countries of origin as well as in diaspora communities.
Topics to be discussed will include:
- informal financial institutions as social support systems,
- the role of informal financial institutions in identity formation,
- the role of informal financial institutions in/following transnational migration,
- informal financial institutions as travelling models.
Time: Saturday, 30/06/2018, 11 am - 1 pm
Venue: Hörsaalgebäude, HS 17
Sophia Thubauville (University of Frankfurt)
Kim Glück (University of Frankfurt)
Hatem Elliesie (Max Planck Institute for Social Anthropology, Halle)
Sophia Thubauville and Kim Glück (University of Frankfurt)
Elias Alemu (Hawassa University, Ethiopia)
Ikechukwu Cosmas Ahamefule
Isusu (Contribution Clubs): An Indigenous Source of Capital Formation Among the Igbo of Southeast Nigeria
There has been a growing concern on how the ordinary man and woman in the rural communities of Africa can raise capital to start some micro-business, thus reducing poverty and improving his/her standard of living. Governments, donor agencies, and international organizations have tried in one way or the other to meet this challenge of the twenty-first century, especially when it became clear that the big financial institutions, such as the commercial banks, stock exchanges, money markets and similar high profile institutions, are not disposed to the ordinary man and woman in the rural areas/villages. The focus of this work is to bring to the fore the indigenous institutions, contribution clubs, which have been sources for savings or pooling (or both) capital (funds) for the benefit of the members. When the major aim of a particular club was to save or put away money to guarantee the members future or for their future expenses within a period of time, such had a different organization when compared to clubs formed mainly for the purpose of raising capital to tackle their need(s). To understand the organization of these clubs, we shall discuss them in two broad perspectives, namely, the savings and the credit contribution clubs. The popularity of these informal institutions savings and capital formation amongst successful elites in our area of study will be emphasized. The scope of this paper is the Igbo of southeast Nigeria, those living within and outside the country.
Social Security in Africa Contextualized: Customary Modes of Ethiopian and Eritrean Societies
The range of actors involved in providing social security in Africa is considerably more diverse than is reflected in the current round of policy formulation. Accordingly, a comprehensive view of social security should be considered. Since scholarly research and institutional stakeholders have been primarily concerned with Western concepts of formal statutory programmes, insights to traditional community based forms have been widely neglected on the international agendas of development co-operation. Questions on how people without access to top-down approaches cope with contingencies have to be addressed. Therefore, the discourses’ focus has to transcend the apparently ideal typical point of reference for discussing social policies. In respect thereof, the paper illustrates selected customary mechanisms of (informal) social security in Ethiopia and Eritrea.
Sophia Thubauville and Kim Glück
More than Saving Money: Ethiopian Informal Saving Associations
The origin of informal saving and insurance associations in Ethiopia is best understood as a development of organizational structures in interaction with the general socio-economic and political context. They emerged in a context of monetization and literacy, closely linked to urbanization, with the need to have clearer community links and obligations once people move out of their familiar environment. In such situations of migration, the mentioned associations partly assist as social support networks. In our paper, we want to take a closer look at the role of informal saving and insurance associations for displaced /migrant communities. Instead of focusing on economic and developmental aspects, we would like to concentrate on social and cultural facets. We argue that the latter becomes especially meaningful for members of displaced/migrant communities.
The Role of Rotating Saving and Credit Associations (Equb) for Migration: Views from Ethiopia
Rotating Saving and Credit Associations (ROSCAS) are the most widely used informal financial institutions in Sub-Saharan Africa including Ethiopia. Despite the growing and expanding formal financial sector in terms of banks and insurance companies, in rural and urban areas, ROSCAS have continued to attract members from all walks of life . However, until recently most of our knowledge about ROSCAS is limited to the economic dimension of the sector when inquiries were made to understand themes such as resource mobilization, insurance, saving, and motives of participants to become members of the ROSCAS in their surroundings. The non-economic dimension of ROSCAS seemed to have been neglected. In this study, I will examine the role of ROSCAS in/following transnational migration. By using an ethnographic method, I will explore the role and contribution of ROSCAS in facilitating transnational migration and the ways in which it helps to establish a network support among members and families through mobilization of resources.