THE IQQUB: TOWARDS THE QUANTIFICATION OF THE ECONOMIC IMPORTANCE OF AN ETHIOPIAN SA VINGS. AND CREDIT ASSOCIATION (ROSCAl

Abstract

Rotating savings and credit associations (ROSCAs) have
remained popular ill many developing coulitries, despite the (!.tpa llsion of
formal finanCial institutions. Iqqub, the Ethiopian ROSCA, has gained
enormOliS popularity among people from all walks of life over the past
decades. Perhaps, its popularity is surpassed ollly by its sister institution,
the iddir. Howe)ler, our understanding of iqqub has remained limited and its
relative size has remained un/mown to researchers. This study attempts to
analyze the major aspects of iqqub and generate rough estimates of irs
potemials ill contributing to domestic saving mobilization efforts in nlral
areas. Using a review of the available literature and results of the four
rounds of Ethiopian Rural Household Surveys (ERHS). the study has
generated qualitative and quantitative evidence of the economic potentials
of the iqqub. It has also argued that these potentials have resulted from the
enormous capacity of this institution to be flexible, adaptable and accessible
under different conditions. The findings of the study could p'rOvide food for
thought for development actors illleresled in mobilizing already available
institutions and k,;owledge systems of rural people