Ajo and esusu explained

Two words for an old habit

Ajo and esusu are Yoruba words for saving together, and you hear them across Nigeria and among Nigerians abroad. Esusu is one of the oldest recorded forms of group saving in West Africa. Other communities have their own words for the same habit: adashe among Hausa speakers, and osusu or isusu among Igbo speakers.

Today people use the words in slightly different ways, so it helps to know which kind of ajo someone means.

The rotating kind

In a rotating ajo or esusu, a group agrees an amount and a day. Everyone pays in on that day, and one member collects the whole pot. The next time, another member collects, and so on until everyone has had a turn. Nobody collects more than the group paid in for that round, and nobody pays more than their agreed share.

If twelve members each pay £50, each round's pot is twelve contributions, and each member receives it once over twelve rounds.

The collector kind

Ajo is also the name for a different service, run by an alajo, a collector who goes round a market or a street collecting small daily amounts from each saver. At the end of the month the collector hands each saver back what they put in, usually keeping one day's collection as a fee.

That is a savings service run by one person, not a rotation among equals, and it carries the risk that the collector disappears with everyone's money. Rotaro is built for the rotating kind, where members pay each other and the money never sits with one person.

Who does what

A rotating ajo usually has a head or organiser who keeps the list and says whose turn it is. Some groups also choose a second person to check the organiser's own payments and to step in if the organiser is away. That simple step removes a lot of quiet worry.

Members agree the rules when they join: how much, how often, how many rounds, what counts as late, and what happens to someone who stops paying.

Choosing the order

The order of turns is where most disagreements begin. Some groups give the early turns to whoever needs money first. Some let members pick. Many draw names. A draw is fairest when everyone can see how it was done and nobody can quietly change the result afterwards.

Members who take the early turns receive their pot before they have paid most of it in, so many groups ask them to name a guarantor: another member who stands behind their payments.

What goes wrong, and how groups protect themselves

The common problems are simple ones:

• Someone receives an early pot and then stops paying.
• Two members remember a payment differently.
• The book lives with one person, and only they know who has paid.
• The rules were never written down, so each member remembers them their own way.

Keeping it on record

Each of those problems gets smaller when the record is shared. With Rotaro, a member marks a payment, the member who received it confirms it, and every member sees the same record. Nothing in it can be edited or deleted. The rules are accepted by every member on joining, and the organiser and a deputy share the decisions.

Rotaro never holds the money. Members still pay each other by bank transfer, exactly as they do today.