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 By Saumu Mwalimu
When hard times hit Mwanahawa Suleiman’s family five years ago, she did not know what to do. She badly needed an extra income, but she was not employed. With all doors seemingly closed, all she could do was pray and hope.
Her prayers were answered when a friend came up with an idea, which she says, has since changed her life. Today, thanks to the “money-go-round” the mother of three joined, she is running a successful food vending business at African Sana market in Dar es Salaam.
“I needed capital to run a small business to increase my family income but I had nowhere to get it from,” says Mwanahawa, who lives in the high-density suburb of Tandale Uzuri.
“Some women in my suburb suggested that we do merry-go-round to help each other out. Most of them are now all in some kind of business – if they are not selling food, it is second hand clothes and so forth. It’s working,” she says.
‘Money-go-round’, commonly referred to as ‘upatu’ in Kiswahili, is an arrangement of contributing money to group members in turns. It can be at the end of every week or month. The money will be used as capital for business or to buy furniture. Everyone in the group waits for his or her turn to get the money.
It has become common all over Tanzania, with both employed and unemployed people joining hands to give and receive money in turns. Apparently, the system has become a source of livelihood for many families in Dar es Salaam.
Like Mwanahawa, Josephine Mataka, a primary school teacher, joined a ‘round’ two years ago. She has since been successfully using the money to pay school fees for her children and settle her annual rent bills.
“I have been a member of two groups so far, and I think it is a worthwhile investment,” says Josephine.
However, not everyone has a successful story like Mwanahawa and Josephine’s to tell about ‘money-go-round’. Conversely, the system has become a source of betrayal among friends, relatives and couples.
Some members of the group break the rules causing tension and strife. Others conspire and form groups within groups that often turn into serious neighbourhood conflicts.
Backing out of the ‘round’
Under normal circumstances, no one is allowed to back out of the rotation system until everyone gets a chance to receive. But cases of people giving excuses soon after they get their share are common.
“I once was one of the culprits in our group because I depended on my husband to contribute my part, and so when he left a small amount for use at home, I was forced to give an excuse not to pay,” says Mwanahawa.
She is not the only one.
Two years ago, Monica Mwaifupe, a stay-at-home wife in Dar es Salaam, joined hands with some women in her neighbourhood to form a 15-member ‘money-go-round’. They all agreed the money would be used as capital for a start-up business.
“We agreed to have a chairlady, who at the beginning collected Sh1,000 from each one of us for five days. So, the plan was we would give Sh75,000 to a member after every five days,” says Monica.
“However, it happened that the chairlady, commonly known as ‘kijumbe’, disappeared with all our money after we had all made our five-day contributions. There was nothing we could do because no one knew where she went,” the mother of four recalls.
Most of the ‘money-go-round’ groups operate without a constitution, but they are based on mutual understanding and trust. This makes it difficult to curb betrayal by some members, says Monica, who now runs a weaving business.
“There is a lot fraud and double-crossing that go on in the ‘merry-go-rounds’ because there are no laws. We trust each other too much, and there are people who join for the mere purpose of stealing by abusing trust,” she says. Despite this, Monica has not lost hope in the ‘rounds’. In fact, they also became her source of capital for the business she is now running.
“I just had to take the risk again because I simply had to. There is no way you can depend on the salary of your husband alone in this age,” she says.
“Now, with my income we are able to send our children to good schools around. It is really working but the truth is there is too much betrayal of trust and confidence because of a few greedy, selfish individuals.”
Excuses for not paying
Another common scandal in ‘merry-go-rounds’ involves members, who are very faithful in redeeming their contributions in time before their turn. But once they get their share, they give all kinds of excuses for not paying. Phillemon Lyimo, a marketing executive with a mobile provider in Dar es Salaam has such a tale to tell.
Together with three colleagues at work, they formed a group and agreed to give each other Sh500,000 a month for any development project one desired. The four of them were the best of friends at the workplace, and that cemented their ‘merry-go-round’.
However, the friendship ended the minute one member of the group failed to honour his part in the ‘merry-go-round’. Interestingly, it was just after he got his share.“We had agreed that we would do the rounds for a whole year, and by mutual consent, no one was supposed to back out for any reason,” says Phillemon.
“The guy, who gave us a raw deal was the last to get in the first round, which began in January last year. He was faithful in the first quarter and he paid everyone in time from January to March. In April, we gave him his money, and also because he was the last to get in the first round, he was the first to get in the second round, which began in May. So, this meant he received his share two months in a row. But when it was time for him to give in June, he told us that his father was sick and so he won’t be able to pay that month.”
“We all understood, and wished his ‘sick’ father well. But that was it. The next month, he travelled to his rural place, where he had opened a small shop. He was on leave, and when I called him to send his contribution, including that of the previous month, he told me his shop was ransacked by thieves. That was the beginning of the end to our group.
I have not joined any group since, and I don’t see myself doing so anytime soon,” says the 34-year-old. Phillemon says his friend paid the money, but after they had taken a tough stance on him, including reporting the case to the boss at work, who threatened to take the money directly from his salary if he did not pay up.
The friendship ended, the group died a premature death, and none of the members has ever again joined a ‘money-go-round’. But not all is doom and gloom about the ‘rounds’. Many people have started their projects and are doing well.
“There are some women, who have actually formalised their groups by way of opening group bank accounts, where the money is deposited,” says Margreth Chacha, the director of Tanzania Women Bank.
However, there are still many challenges, she says. “One of the biggest problems is that many people, especially women, do not have qualifications that make it possible for them to register, so they are exposed to all kinds of betrayal by some selfish indiviuals,” Ms Chacha notes. Still, she encourages women to open special bank accounts for their groups.
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