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RoSCAs in Africa: The Case of Egypt

Enterprise and Economic Development in Africa

ISBN: 978-1-80071-323-9, eISBN: 978-1-80071-322-2

Publication date: 11 June 2021


Rotating Savings and Credit Associations (RoSCAs) are informal lending groups widely found in many developing countries around the globe. This chapter studies the interest-free RoSCAs in Egypt and how it compares to other RoSCAs in Africa. The chapter also examines the possible motives for RoSCA participation employing a primary dataset collected from Cairo, the Egyptian capital. The motives studied include access (or lack thereof) to the formal banking sector, religiosity, self-control, and social preferences. Trust and trustworthiness among RoSCA participants are also studied. The chapter shows that RoSCA participation is very popular among the sample respondents regardless of income levels, access to formal banking and religious views. RoSCAs, however, are shown to play an important role as a commitment device for savings and investment, including human capital accumulation when the self-control level is moderate or low. Social preferences and trust levels, on the other hand, are not found to be significantly different for RoSCA and non-RoSCA participants.



Rabie, D. (2021), "RoSCAs in Africa: The Case of Egypt", Nziku, D.M. and Struthers, J.J. (Ed.) Enterprise and Economic Development in Africa, Emerald Publishing Limited, Leeds, pp. 277-291.



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