Rotating savings and credit associations (ROSCAs) are informal financial institutions serving the financial needs of many people in Nigeria and other developing countries for centuries. It has several names across different countries in the world. In Nigeria, it is popularly known as Esusu, Osusu, Enusu, Ajo (Yoruba), Cha (Ibo), Oha, Oja, Adashi (Haussa, Tiv), Bam (Tiv), Isusu (Ot), Utu (Ibo), Dashi (Nupe), Efe (Ibibios), Oku (Kalabari Ijawas), Mitiri, Compiri, Club (Ibo).
In the ROSCAs system being digitized by AjoMoney, a group of trusted individuals agree to contribute a fixed amount into a fund at regular intervals. This process continues until all members receive the sum of the money that has been deposited into the fund in turn. In Nigeria, through traditional means, rotating group savings is one of the community support mechanisms helping fragile households cope with certain crises through the network of informal and formal relationships.
A larger percentage of Nigerians are undercapitalized, suggesting major operational difficulties in accessing credit and pursuing corporate goals. Non-availability of long-term finance and long procedures to access financial help, where available, has been identified as a major constraint facing individuals and businesses in Nigeria.
As technology and other financial technology companies have made access to financing possible through loans with monthly interests, AjoMoney believes that they can travel back in time to fully digitize the centuries-old method our forefathers have been using to gain access to financing without the burden of paying a high-interest.
As the ROSCA system is actively being adopted by 50% – 90% of the adult population in Nigeria. It has really been a tool for easy access to credit, mutual insurance, purchase of goods, early acquisition of assets, poverty reduction and money saving discipline.
AjoMoney, which was founded by Ibrahim Adepoju and Chineye Ochem was able to digitize the rotating savings and credit association system through their mobile application, which is currently available on google play store and apple app store.
The social and information age is changing the way people see rotating savings. The issue of trust and safety by the individual managing the rotating savings has made many lose hope in the rotating savings system. AjoMoney, ever since it was launched in July 2021, has registered more than 1500 users in averagely three (3) months with zero advertising budget. Users in the age range of 19 to 45 years have been searching for related apps on both playstore and Appstore, and were eager to check it out upon seeing the arrival of AjoMoney.
AjoMoney not only targets adults to whom the rotating savings system is very notable, but also targets millennials and gen-z who are having issues with zero-burden access to finance, enabling them to also benefit from the system their parents have been using to cover many bills and sponsor the family needs during tough economic times.
“Growing up in Nigeria, my parents leveraged on rotating savings with collections scheduled for August, September and October, so as to be able to pay our school fees and other amenities needed, which also included investing into other assets like renovating our house and upgrading the livelihood of the family. They have been doing this for decades and they pay back flexibly with zero interest. In a time of financial crisis like this, AjoMoney was built for Nigerians struggling to stabilize their finances to meet necessary immediate and future needs.”
— Ibrahim Adepoju, Co-founder and CEO, AjoMoney
AjoMoney leverages on the user’s initial credit score upon joining the system to match them to a rotating savings group where they can save a specific amount of money monthly or weekly with other people of the same financial strength. AjoMoney is unlike other savings platforms where an individual is tasked with saving alone and having access to it at a specific time and likely getting to lose the benefit attached for withdrawing the money at an early stage or other lending platforms where an individual is offered a loan and mandated to pay with additional interest ranging from 6% to 30% monthly.
While AjoMoney is not just only providing credit and savings solutions to Nigerians, AjoMoney also has sister products in the alpha stage, which includes AjoStore for merchants to sell products and receive early payment from AjoMoney users who got access to finance early to meet their needs. Also, AjoMoney wallet system is being linked to AjoPay, the flexible payment solution that AjoMoney users can use to easily checkout from AjoStore and other partnering e-commerce sites; this also supports sending and receiving money between banks and different AjoPay wallets. Other features live on AjoMoney is the bill payment feature.
Recently, Professor Ndubuisi Ekekwe of Tekedia Institute became a member of the AjoMoney Advisory Board to help foster the growth of the company.
With AjoMoney, if you can afford it later, you should be able to get it now.