Savings and Credit Associations (ROSCRAs and ASCRAs)

A similar type of savings and credit association that operates like an informal credit union is an Accumulating Savings and Credit Association (ASCRA). These associations, with considerably larger groups ranging from several hundred to several thousand members, accumulate their savings for a certain period of time, usually one or several years. After this time period has ended, participants? savings are redistributed and used for a large purchase, event, investment or other purpose by an individual or group. During this saving period, loans can be made to participants. This loan process is different from that of a ROSCA, since these loans are approved on an individual basis by the group instead of being automatically granted one by one.