My husband, born in Kerala, India and raised in Dubai, remembers his parents participating in ‘kuri‘ clubs.

All the participants – mostly members of his extended family – would get together for a celebratory dinner.

During the evening, everyone would give their kuri contribution to the oldest brother, and a name would be drawn from all the contributors.

The winner of the draw received all the money contributed that week – they could pay off an interest-bearing loan, invest in their fledgling business, celebrate a wedding, or help pay their children’s school fees.

Then the next month it would happen all over again. Previous winners were removed from the drawing so everyone was guaranteed a share of the money at least once. And the whole group could make future plans, knowing a larger sum of money was headed their way in just a few months.

Groups like this exist all over the world. In Africa and the Caribbean they’re often called ’susu funds’. In spanish speaking communities they might be known as ’sociedads’. In other parts of India, they can be called ‘chits’. These groups, which are collectively described as “Rotating Savings and Credit Associations” (ROSCAS), have a centuries-long history in Kerala and elsewhere. Women in the world’s poorest households use this strategy by each contributing a handful of rice from the week’s allotment, which can be pooled and sold to create a much-needed source of cash money.

For communities without dependable banks, it makes sense for everyone to pool and quickly use large amounts of savings, rather risk having money stolen from home. Such clubs also continue to form and function in ‘global North’ countries where people have access to interest-bearing savings accounts and bank loans.

Kuris, susus and other ROSCAs don’t pay out interest, and in some groups it’s expected that the organizer will take a small cut of the total pool in return for her time. But what ROSCAs offer instead of interest is peer pressure to keep contributing and saving on a regular basis, in order to keep up with your obligation to the group and avoid having to explain to your friends why you can’t give your share.

This kind of peer pressure and obligation to keep up your good name is called social capital, and it’s what makes ROSCAs successful. By making sure you don’t miss a payment, it’s possible for you to come out ahead of saving in a traditional savings account. How? Well, if you put $200 in a savings account each month for a year, you’d earn about $22 in interest over the year, leaving you with $2422. But if you miss even one monthly contribution, you’ll be left with $2220 at most (the exact amount depends on which month you miss).

On the other hand, you won’t earn any interest from the ROSCA but your family and friends will be there to help and hassle you, keeping you accountable to make the payment. So you’re likely to contribute – and receive – the entire $2400.

It’s up to you to decide whether you can stay accountable to yourself to make regular deposits to a traditional bank, earning interest all the while, or if you’d benefit from the support and social experience a ROSCA can provide.

If you decide to participate in a ROSCA, check out the excellent tips in this article on Susus from Black Voices: And be aware that some people can claim they’re running a ROSCA but really be setting up a scam – it’s always best to participate in a group with people you know and trust.