Rotating Saving and Credit Associations as an Informal Finance Tunnel Evidence from Egypt
April 4th, 2019
ByDr. Ahmed Taha Al Ajlouni
This article empirically investigates the drives for participation in Jamey’ah (literally, Society) in Egypt as types of Rotating Savings and Credit Associations (ROSCAs) that agree in their general framework with Islamic principles. The article also evaluates the sample’s experience in order to understand the influence of gender and income on the motives behind Society sharing and their valuation. The findings show that the amounts raised by societies are allocated to essential expenses. The tough procedures in case of borrowing; and low return in case of saving were the drivers behind leaving banks to finance via Societies as the results strongly suggest. The valuation of Societies indicate apparent impressive positive trend as the results strongly suggest. There is considerable empirical evidence showing that Societies can be a substitute to banks in providing personal loans.