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Thrift as alternative access to capital for traders

Mrs Anita Idowu, a tailor at the Garki Market in Abuja who contributes daily to the scheme

Majority of Nigerian traders participate in the daily contribution of money (thrift saving scheme), popularly known as esusu/ajo/adashe. Daily Trust spoke with traders and collectors who gave reasons the financial scheme is necessary.


A percentage of Nigeria’s population, especially traders and those living in rural areas, partake in daily contributions known as esusu or ajo. This is where an individual, usually the collector, goes from shop to shop, to collect some amounts of money from different customers daily or weekly. A percentage of the money collected belongs to the collector for services rendered. At the end of the month, the money is usually disbursed to each member of the group in sequence and collection starts all over again.

The aim of this scheme is to help the traders and other contributors save a percentage of their income to create access to finance for other small-scale entrepreneurs. Also, these traders can build up capital using the scheme to invest in other businesses.

With the esusu scheme, there is neither gain nor loss; rather, a lump some of the money contributed is returned to the contributor after the service fee for the collector has been deducted.

Mrs Anita Idowu, a tailor at the Garki Market in Abuja who contributes daily to the scheme, told Daily Trust that saving through it was more efficient for her than the banks.

“All I need to have access to my savings in the bank is a short code or call my bank manager. With esusu, the money is not easily accessible until I put in a plan,” she explained

Also, Aisha, who runs a provision store in the same market, said contributing to the esusu scheme was a faster and less stressful means of saving money. “I would rather sit in the convenience of my shop and have people come to collect my money to keep, rather than going to join a long queue in the bank, especially when I cannot afford such luxury of time,” she said.

She also said that saving through the scheme had helped her learn to prioritise and cut down on excessive spending.

Mrs Helen Ibe, an esusu collector, told Daily Trust that she had engaged in this trade for three years. According to her, she has a lot of female clients at the Garki Market. She explained that running the business is not easy as an individual is solely responsible for people’s finances.

“Trust is an important thing in this our business. I have been able to prove myself as reliable and credible, that’s why my customers feel safe keeping their money with me. I have never been robbed nor has any money kept under my watch gone missing,” she said.

Just like any financial institution, participating in the esusu saving scheme involves a lot of risks. The collector can easily get robbed and might also not have access to disburse funds to customers as urgently as they need it.

“Collecting money, especially in an open space like a market, is already a big risk. You can be followed or tracked down by robbers. Also, some customers may need to withdraw their contributions and the funds may not be readily available. In this case, the customer is delayed till the money is ready. Also, if my ledger gets missing, it means I have no proof of transactions that have been made so far,” Mrs Ibe explained.

In a day, she receives contributions from 40 traders in the market, but the ratio of women is higher than the men.

She further explained that although there’s a fixed amount of money contributed, customers are allowed to give more than that if they could afford it.

She said: “I start collecting from 12pm. And I collect from all my registered members. Once I am done for the day, I head to the office to go through my ledger for all the transactions. After that, I go to the bank to deposit all the money.”

To make the service more efficient, Mrs Ibe said her clients were usually informed to request for withdrawal two days ahead so that funds would easily be ready for disbursement.

She also considers the risks that come with her job and tries to put certain safety measures in place when going to the market to collect contributions from members.

“I always collect my contributions in secluded corners or my customers’ shops. I make sure I fill my customers’ passbooks before leaving their shops. Most importantly, I must deposit all the cash collected. Money must never follow me home,” she said.

According to her, because her fee is 10 per cent of what each contributor would receive at the end of the month, her clients always agree to contribute substantial amounts. She added that the business could be said to be lucrative.

Emmanuel Oke, one of Mrs Ibe’s contributor, told our reporter that the Esusu scheme had helped him save capital, which he used in funding his business.

“The money I save with the esusu scheme is put into my business; that way, I am certain that for any business plan I want to embark on, I have money somewhere,” he said.

Uche Eke, another collector who has been receiving contributions at the Utako Market, said although many people saved their money in the banks, a lot of traders still saved a large percentage of their income through the esusu scheme.

She also admitted that the business involves a lot of risks, such as record mismanagement, issues of fraud etc.

“It comes with a lot of risks. There may be cases where one could forget to record transactions in the ledger or passbook. Also, some collectors can decide to run away with customers’ funds, which will in turn sow a seed of distrust between collectors and clients,” she said.

According to Eke, she gets contributions from 30 traders in a day at the Utako Market. Her customers consist of foodstuff sellers, cloth sellers, hairdressers etc.

Similar to the Garki Market, the ratio of women who partake in the esusu scheme is higher than men.

She further explained: “Customers registered under our scheme are to make a daily deposit of N1,500, so my total sum of contributions in a day is usually between N35,000 and N45,0000, depending on how many people that contributed.”

Although esusu has its rules and regulations, a common challenge faced by collectors is constantly reminding or asking clients to pay their contributions.

“So many times you can go to a shop and they will tell you that they didn’t make sales, so they will not contribute for that day. And you have to constantly remind them to pay up so that you can balance the ledger account before the end of the month,” she said. She, however, explained that sanctions were being put in place for persons who make late contributions.

The esusu scheme has proved to be a very reliable financial and credit system for petty traders and people in the rural areas who do not have access to banks and microfinance institutions.

These esusu groups have severally saved a lot of traders from facing setbacks, such as inability to secure loans because of lack of collateral security. With this scheme, small-scale traders are now given the opportunity to save capital or receive loans to fund their businesses.