What women can do...Kenyan men embrace 'merry-go-round' savings schemes By XINHUA | Tuesday, January 8 2013 at 16:27
At the beginning of every month, office worker Vincent Mulwi ensures he has sent $35 to one of his friends, who he shares a savings group with.
Mulwi, as the organising secretary of the group, further sends text-messages by the fifth day of each month to his other friends, who are in the savings group reminding them to remit their $35.
If someone does not adhere to the set timeline, it is Mulwi's duty to find out why or reprimand him. "I have been doing it for the past two years. We are six of us in the group and all of us are men. Two of us work in the same organisation, but the rest work for different companies," Mulwi, who is employed as a research assistant in a non-state organisation in Kenya's capital Nairobi, says.
Mulwi and his five friends are among an increasing number of men in the east African nation who embracing "merry-go-round" savings schemes. The schemes, initially associated with women, have become popular among men in Kenya as people seek avenues to save money or use them as tools for investments.
While women in the east African nation started engaging in the schemes over decades ago, it is only until recently that men, who dismissed the groups as "dens of gossip," have seen them useful and are embracing them. The men have adopted ways women run their schemes, which have made them successful thus attracting financial institutions like banks, which are targeting them with their products.
"We raise money at the beginning of every month and give it to one person. This happens each month until the last person is served. Since we have different work schedules and commitments, which make meetings difficult, we send money to the person through mobile phone cash transfer system," said Mulwi.
To come up with the order in which members were to receive money, Mulwi and his friends drew lots, just as women do. "At our first meeting, we wrote numbers on small pieces of paper, folded and mixed them. Then each one of us picked a piece. The number that one picked became his position in the order of receiving the merry-go-round money," said Mulwi, who is at position four.
This month, the group has given money to position one person as the year is beginning. "Since we are six, each one of us receives money twice a year. We have started with position this January and by June; we would have gone through the first cycle. We have meetings at the end of each cycle to evaluate our progress," he explained.
"It is true that merry-go-round schemes are associated with women but they are good initiatives especially when it comes to empowering members economically. In our case, most of us use the money, for instance, to buy house items or even pay schools," said Henry Kundu, another member of the group.
Kundu said they came up with the idea of starting the scheme after seeing how their mothers and girlfriends were benefitting from them. "While growing up, my mother was in such a group and I saw how it helped her greatly. She bought our first cow using money she had received from merry-go-round. She also paid my school fees using the money," he said.
His girlfriend, he narrated, is also in such a scheme and she is the one who encouraged him to join one. "She wanted me to join their group but I saw it won't work since I would be the only man. I then shared the idea with Mulwi, who talked to another of his friends and we started Concord Savings Group," recounted Kundu.
Kundu and Mulwi said they have plans to convert the scheme into an investment group. "In the past two years, we have been able to build trust amongst ourselves since all of us have been remitting the money every month diligently. Our plan is that after June, we will stop giving each other money but save it in a bank so that we can later invest," he said.
Journalist Bernard Ndegwa observed that men in the east African nation have no choice but to embrace merry-go-round schemes if they are to stay ahead of women financially. "Financial analysts estimate that two in every five women in Kenya are in merry-go-round or investment schemes. This means that women, who have been subjugated for several years, are empowering themselves," he said adding that men have realised this and are starting savings schemes to catch up with women.
However, Ndegwa, who is also in a merry-go-round savings scheme noted women are more organised than men. "Women are always dedicated. They will attend meetings and contribute diligently, unlike men some of who even do not attend meetings. We had two such members in our group and we had to dismiss one. The other reformed," he said.
Investment groups or merry-go-rounds, which are also known as chamas, according to Kenya Association of Investment Groups, control up to $1.1 billion of assets in the east African nation. This is about 10 per cent of total deposits held by banks in the country.
Kenyans use the schemes to buy land and trade in shares and government securities, among other investments. Banks in the east African nation have recognised the potential of the schemes and have opened products tailor-made for them.
How will you celebrate the 2014 Christmas?speak out
Read Story: How will you celebrate the 2014 Christmas?
- Oliver Mtukudzi discloses HIV status
- The girl who met Gaddafi 'in hell'
- Meet Kenya's richest 25
- New Zambian president Edgar Lungu sworn in
- Ghanaian official dismisses criticism over wife's coat on state visit
- Kenya's super rich billionaire's club
- Tanzania bans ‘The EastAfrican’ over coverage of govt, registration
- Kenya to expand national secondary school system
- Officials hint at plan for Kagame third term
- The soldiers without enough weapons to fight jihadists