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Book part
Publication date: 11 June 2021

Dina Rabie

Rotating Savings and Credit Associations (RoSCAs) are informal lending groups widely found in many developing countries around the globe. This chapter studies the…

Abstract

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.

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Article
Publication date: 1 January 2006

Elsa Bawani Satkunasingam and Bala Shanmugam

To provide arguments in favour of legalising rotating savings and credit associations (ROSCAs) as they play an important role in savings and credit for women in Malaysia.

Abstract

Purpose

To provide arguments in favour of legalising rotating savings and credit associations (ROSCAs) as they play an important role in savings and credit for women in Malaysia.

Design/methodology/approach

The paper refers to previous studies on ROSCAs in Malaysia and extracts information that shows that ROSCAs are used mostly by women as a method of forced‐savings, credit and insurance against uncertainties. It suggests different methods that can be used to make ROSCAs more efficient. Finally, it provides suggestions for amendments to existing legislation which will not interfere with the social structure that supports ROSCAs, yet permit participants to sue defaulters.

Findings

The findings show that ROSCAs are widely practised in Malaysia especially in the rural and suburban areas. The participants are mostly women from middle income and low‐income groups who used it as a form of savings or credit. The benefits of permitting ROSCAs outweigh the risks. Legalising ROSCAs will not remove the benefits but will substantially reduce the risks.

Originality/value

This paper provides arguments to legalise ROSCAs in Malaysia and provides suggestions to ensure greater efficiency and a lower default rate. It also suggests amendments to the legislation to enable participants to take quick and cheap legal action against defaulters.

Details

Journal of Money Laundering Control, vol. 9 no. 1
Type: Research Article
ISSN: 1368-5201

Keywords

Content available
Article
Publication date: 10 July 2017

Seyed Kazem Sadr

Several indigenous credit and savings schemes have been accredited recently in developing countries for the benefit of households and entrepreneurs alike. Famous among…

Abstract

Purpose

Several indigenous credit and savings schemes have been accredited recently in developing countries for the benefit of households and entrepreneurs alike. Famous among them are the Rotating Savings and Credit Associations (ROSCAs) that exist in almost all continents currently. The rapid development of ROSCAs and their varied structures in many countries have been the subject of numerous studies. What has not been thoroughly analysed is the optimum size of these associations and the fact that lending and borrowing is without interest. The aim of this paper is to present a model that would determine the optimum size of ROSCAs and deal with the following issues: how the group size varies with changes in the income level of the members, the demand for the loan, the size of the collected loan and its duration. Further, the question of whether or not lending to the association in return for obtaining larger sums is a violation of the qarḍ (loan) contract is dealt with, and several Sharīʿah compatible formulations are provided.

Design/methodology/approach

Economic analysis has been applied to show the optimum size of Qarḍ Ḥasan Associations (QHAs), which are the Sharīʿah-compliant equivalent of ROSCAs, and the Sharīʿah rules of the qarḍ contract to illustrate the legitimacy of group lending.

Findings

The major findings of this study are determination of the optimum size of QHAs, the factors that affect the size and suggestion of alternative legal forms for group financing.

Research limitations/implications

Inaccessibility to sources of data to test the hypothesis that has been put forth is the main difficulty encountered when conducting research on the subject.

Practical implications

The paper concludes that the development of informal interest-free ROSCAs in both Muslim and non-Muslim countries is an efficient informal microfinance scheme and that it is compatible with Sharīʿah rules.

Originality/value

The optimum size of ROSCAs and QHAs has been presented in this paper.

Details

ISRA International Journal of Islamic Finance, vol. 9 no. 1
Type: Research Article
ISSN: 0128-1976

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Article
Publication date: 28 March 2019

Habiba Ibrahim

Guided by the institutional theory of savings, the purpose of this study is to assess the institutional elements of rotating, savings and credit associations (ROSCAs) that…

Abstract

Purpose

Guided by the institutional theory of savings, the purpose of this study is to assess the institutional elements of rotating, savings and credit associations (ROSCAs) that enable participants to save.

Design/methodology/approach

The study used data from in-depth qualitative interviews (N = 10) conducted among the ROSCA group leaders from African immigrant communities in the USA.

Findings

The primary goal for joining the ROSCA group among participants is to achieve economic stability. The results of the study postulate that, through institutional mechanisms and social networks, ROSCAs create an environment for families to save and invest. The emphasis on the concept of “you cannot save alone” underscores the importance of supportive structures to enable low-income households to save. Although “alternative savings programs” such as ROSCAs are imagined as something that less well-to-do persons use, the findings from this study demonstrate that such strategies also appeal to some people with higher socioeconomic status. This appeal and utility speaks to the importance of ROSCAs as an institutional response, rather than just an informal arrangement among persons known to each other.

Research limitations/implications

It is prudent to bear in mind that the study sample is not nationally representative, and therefore, the results presented cannot be generalized to immigrants across the country. However, as one of the few ROSCA studies in the USA, the findings from this study make generous contributions to the immigrants’ savings and ROSCA practices literature.

Practical implications

ROSCAs could be used as a bridge to the formal financial institutions. Non-profit agencies working with these communities could work with these groups to report ROSCA payments to the major credit bureaus, to help them build a credit line in their new country.

Originality/value

Previous studies of ROSCAs have assessed ROSCAs as community support systems and social networks. The current study has analyzed ROSCAs from an institutional perspective by examining the institutional characteristics of ROSCAs comparable to the institutional determinants of savings that enable savings among the participants.

Details

Journal of Enterprising Communities: People and Places in the Global Economy, vol. 13 no. 3
Type: Research Article
ISSN: 1750-6204

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Book part
Publication date: 19 May 2009

Kristiano Raccanello, Jayant Anand and Patricia Arroyo Martínez

The literature on Rotating Savings and Credit Associations (ROSCAs), commonly known as tandas in Mexico, indicates a higher participation of women but generally fails to…

Abstract

The literature on Rotating Savings and Credit Associations (ROSCAs), commonly known as tandas in Mexico, indicates a higher participation of women but generally fails to detect the reasons thereof. This chapter partially bridges the gap by considering the role of social capital in these organizations. The findings of this study show that socioeconomic factors, the gender of the member majority, and acceptance levels in the group influence the higher participation of women. However, access to formal credit markets does not influence this behavior. Moreover, trust in women-based groups and the benefits obtained from membership further contribute to higher participation of women. The participation of men in ROSCAs seems to be related to motivational factors that are different from those for women. For women, social capital is especially relevant for gender-based group formation.

Details

Economic Development, Integration, and Morality in Asia and the Americas
Type: Book
ISBN: 978-1-84855-542-6

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Book part
Publication date: 4 December 2003

Ivan Light

The literature of ethnic ownership economies descends from middleman minority theory, a subject it continues to include. However, ethnic economy literature now more…

Abstract

The literature of ethnic ownership economies descends from middleman minority theory, a subject it continues to include. However, ethnic economy literature now more broadly addresses the economic independence of immigrants and ethnic minorities in general, not just of middleman minorities (Light & Bonacich, 1991, pp. xii–xiii).1 This expansion releases the subject from narrow concentration upon historical trading minorities, and opens discussion of the entire range of immigrant and ethnic minority strategies for economic self-help and self-defense. Partial or full economic independence represents a ubiquitous self-defense of immigrants and ethnic minorities who confront exclusion or disadvantage in labor markets. Ethnic economies permit immigrants and ethnic minorities to reduce disadvantage and exclusion, negotiating the terms of their participation in the general labor market from a position of greater strength. Unable to find work in the general labor market, or unwilling to accept the work that the general labor market offers, or just reluctant to mix with foreigners, immigrants and ethnic minorities have the option of employment or self-employment in the ethnic economy of their group. Although ethnic and immigrant groups differ in how well and how much they avail themselves of this defense (Collins, 2003; Light & Gold, 2000, p. 34; Logan & Alba, 1999, p. 179), none lacks an ethnic economy.2

Details

Ethnic Entrepreneurship: Structure and Process
Type: Book
ISBN: 978-1-84950-220-7

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Article
Publication date: 28 April 2020

Alin V. Roşca, Natalia C. Roşca and Ioan Pop

The purpose of this study is to describe the steady mixed convection stagnation point of a hybrid nanofluid with a second-order velocity slip.

Abstract

Purpose

The purpose of this study is to describe the steady mixed convection stagnation point of a hybrid nanofluid with a second-order velocity slip.

Design/methodology/approach

Using appropriate similarity variables, the partial differential equations are transformed into ordinary (similar) differential equations, which are numerically solved using the bvp4c function in MATLAB. The numerical results are used to present graphical illustrations for the reduced skin friction, reduced Nusselt number, velocity and temperature profiles.

Findings

Dual solutions are discovered in this study. Thus, stability analysis is implemented and the first (upper branch) and second (lower branch) solutions are determined and analyzed.

Research limitations/implications

Hybrid nanofluids have many practical applications in the modern industry such as in micro-manufacturing, periodic heat exchanges process, nano drug delivery system and nuclear reactors.

Originality/value

Despite numerous studies on the mixed convection stagnation point of classical viscous fluids past a vertical plate flow, none of the researchers have focused on the effect of second-order slip velocity on hybrid nanofluids. The behavior of the flow and heat transfer has been thoroughly analyzed with the variations in governing parameters such as heat source/sink and nanoparticle volume fraction. Moreover, the use of the wall slip velocity in this hybrid nanofluid model strengthened the novelty of this study.

Details

International Journal of Numerical Methods for Heat & Fluid Flow, vol. 31 no. 1
Type: Research Article
ISSN: 0961-5539

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Article
Publication date: 10 December 2019

Mohammad Ghalambaz, Natalia C. Roşca, Alin V. Roşca and Ioan Pop

This study aims to study the mixed convection flow and heat transfer of Al2O3-Cu/water hybrid nanofluid over a vertical plate. Governing equations for conservation of…

Abstract

Purpose

This study aims to study the mixed convection flow and heat transfer of Al2O3-Cu/water hybrid nanofluid over a vertical plate. Governing equations for conservation of mass, momentum and energy for the hybrid nanofluid over a vertical flat plate are introduced.

Design/methodology/approach

The similarity transformation approach is used to transform the set of partial differential equations into a set of non-dimensional ordinary differential equations. Finite-deference with collocation method is used to integrate the governing equations for the velocity and temperature profiles.

Findings

The results show that dual solutions exist for the case of opposing flow over the plate. Linear stability analysis was performed to identify a stable solution. The stability analysis shows that the lower branch of the solution is always unstable, while the upper branch of the solution is always stable. The results of boundary layer analysis are reported for the various volume fractions of composite nanoparticles and mixed convection parameter. The outcomes show that the composition of nanoparticles can notably influence the boundary layer flow and heat transfer profiles. It is also found that the trend of the variation of surface skin friction and heat transfer for each of the dual solution branches can be different. The critical values of the mixed convection parameter, λ, where the dual solution branches joint together, are also under the influence of the composition of hybrid nanoparticles. For instance, assuming a total volume fraction of 5 per cent for the mixture of Al2O3 and Cu nanoparticles, the critical value of mixing parameter of λ changes from −3.1940 to −3.2561 by changing the composition of nanofluids from Al2O3 (5 per cent) + Cu (0%) to Al2O3 (2.5%) + Cu (2.5 per cent).

Originality/value

The mixed convection stability analysis and heat transfer study of hybrid nanofluids for a stagnation-point boundary layer flow are addressed for the first time. The introduced hybrid nanofluid model and similarity solution are new and of interest in both mathematical and physical points of view.

Details

International Journal of Numerical Methods for Heat & Fluid Flow, vol. 30 no. 7
Type: Research Article
ISSN: 0961-5539

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Article
Publication date: 19 June 2019

Natalia C. Roşca, Alin V. Roşca and Ioan Pop

The purpose of this paper is to theoretically investigate the unsteady separated stagnation-point flow and heat transfer past an impermeable stretching/shrinking sheet in…

Abstract

Purpose

The purpose of this paper is to theoretically investigate the unsteady separated stagnation-point flow and heat transfer past an impermeable stretching/shrinking sheet in a copper (Cu)-water nanofluid using the mathematical nanofluid model proposed by Tiwari and Das.

Design/methodology/approach

A similarity transformation is used to reduce the governing partial differential equations to a set of nonlinear ordinary (similarity) differential equations which are then solved numerically using the function bvp4c from Matlab for different values of the governing parameters.

Findings

It is found that the solution is unique for stretching case; however, multiple (dual) solutions exist for the shrinking case.

Originality/value

The authors believe that all numerical results are new and original, and have not been published elsewhere.

Details

International Journal of Numerical Methods for Heat & Fluid Flow, vol. 29 no. 8
Type: Research Article
ISSN: 0961-5539

Keywords

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Article
Publication date: 4 October 2018

Ioan Pop, Natalia C. Roşca and Alin V. Roşca

The purpose of this paper is to study the effects of MHD, suction, second-order slip and melting on the stagnation-point and heat transfer of a nanofluid past a…

Abstract

Purpose

The purpose of this paper is to study the effects of MHD, suction, second-order slip and melting on the stagnation-point and heat transfer of a nanofluid past a stretching/shrinking sheet.

Design/methodology/approach

Using appropriate variables, the governing partial differential equations were transformed into ordinary (similarity) differential equations, which are then solved numerically using the function bvp4c from Matlab.

Findings

It is found that dual (upper and lower branch) solutions exist for some values of the governing parameters. From the stability analysis, it is found that the upper branch solution is stable, while the lower branch solution is unstable. The sample velocity, temperature and concentration profiles along both solution branches are graphically presented.

Originality/value

The results of the paper are new and original with many practical applications of nanofluids in the modern industry.

Details

International Journal of Numerical Methods for Heat & Fluid Flow, vol. 28 no. 9
Type: Research Article
ISSN: 0961-5539

Keywords

1 – 10 of 254