Let’s look before we leap: challenging our ideas on how savings groups work

What assumptions do savings group advocates and practitioners hold about how groups work, and are they justified? As NGOs promote ever more savings groups, they cite a list of benefits: access to funds for emergencies and investments, profits on savings, and strengthened social ties. At the same time, they generally follow a set of ‘golden rules’: pay out annually, charge interest, and target women. Yet the benefits are only realized when a number of factors fall into place, and the rules don’t always make sense in different contexts. Savvy promoters and groups are already questioning these assumptions and adapting policies to better meet their needs; more could do so. In this paper we question some pervasive assumptions about savings groups. We provide counter-examples and lessons learned from our own experiences, those of others in the field, and published literature, in hopes of encouraging practitioners to examine these assumptions in their own contexts.