Problems Faceing Susu Collectors in the Bantama Sub-Metro

Topics: Savings and loan crisis, Savings and loan association, Bank Pages: 55 (7967 words) Published: January 20, 2012


Background to the study

Personal saving may be voluntary; it can also be contractual through insurance

policies by insurance companies and also contributory if through the traditional

social security system or “susu“. “Susu” is a traditional form of saving where an

individual saves a fixed amount per day with a “susu” collector for a specified period, say

one month. At the end of the month, the Individual collects his or her total savings less

one day’s installment, which the “susu” collector deducts as commission. The higher the

number of clients of a “susu” collector, the higher the level of that collectors commission

at the end of each calendar month.

“Susu” is the popular name given to the rotating savings club in Ghana. It

is said to be of Yoruba origin, which is an adulteration of “esusu”. The term is

believed to have been introduced into Ghana by migrant Ibo traders before independence

in 1957, when formal banking had not caught up well with people especially the

indigenous illiterates folks who were mainly traders. With the Alien’s Compliance Order

in 1969 coming into force, these aliens left this legacy. Then came quite a number of

Ghanaians entering into the business as a result. A few unscrupulous persons also crept in

and some actually bolted away with their clients saving. (Aryeetey and Gockel, 1991)

In response to the increased cases of fraudulent practices of some “susu”

collectors in the late 1980’s, Ghana Co-operative “Susu” Collectors Association was

formed in 1990 in an attempt to regulate and supervise the activities of the “susu”

collectors. This association serves as the mouthpiece for all “susu” co-operatives in

Ghana. It is the agent that collects taxes on behalf of the commissioner of internal

revenue services and external credit facilities for its regional or district societies.

(Aryeetey, 2000) and Ardner (1964) echo an informal confirmation that “susu” was an ancient

institution prior to the introduction of the British currency. “Susu” was practiced by

Nigerian traders in Makola number (two) market in Accra. Apart from the term “susu”, the

rotating saving club is known by other names in different parts of Ghana. The Ewe’s generally

refer to the clubs as “edzodzo” or “eso dzodzo”. Whist among the Kotokole’s in the northern part

of the Volta region, it is known as “edeso” (I.P.C, 1988). In some quarters in Laura town the club

is known as “lekseque”.

Statement of the problem

People have realized the importance of “susu” scheme yet “susu” collectors

faces a lot of problems mobilizing contributors to participate in the scheme. A lot

of contributors have lost interest or back out of the scheme because of the bad

perception about “susu” collectors. Collectors find themselves wanting as sometimes

the group in which they join collapse as a result of embezzlement by the group

leaders. Some contributors also end up collecting their share of the money

contributed and refuse to contribute again. Banks that are involved in the saving

scheme also faces documentation problems with their clients.

Unfortunately the large amount of research on informal savings has not

investigated the problems facing the “susu” collectors. In pursuit of this research,

however, an attempt has been made to find the antecedent facts that leave the

“indigenous savings scheme” incapable of living up to expectation as far as

mobilisation, administration and management of funds are concerned.

Purpose of the study

General Objective:

The general purpose of this study was to discover the problems facing “susu”

collectors. The specific objectives of the study are;

Specific Objectives:

1. To examine some silent points in the administration and management of “susu” schemes. 2. To identify how “susu” saving scheme is organized and...
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