Tontin

Tontin is a form of informal savings and credit arrangement common in Francophone Africa, often described as a rotating savings and credit association (ROSCA). In a tontin, a group of people agreement to contribute a fixed amount at regular intervals to a common fund. At each interval, the total collected is awarded to one member, chosen by a method such as a lottery, a bid, or a predetermined rotation. The process continues until every member has received the pot, or the cycle is extended by mutual agreement. The arrangement provides a lump sum for large purchases, emergencies, or investments while encouraging disciplined saving within a trusted network.

Tontins are usually organized informally by family, friends, or colleagues and operate with written or verbal rules. They can be attractive because they offer quick access to cash without formal banking, but they carry financial risk. If a member defaults or if there is mismanagement, funds can be lost, and there is limited legal protection compared with formal financial institutions. Regulatory approaches to savings clubs and microfinance vary by country and can affect how tontins operate.

The term tontin is related to the broader tontine family of savings and investment designs and is often used interchangeably with ROSCA or susu in different regions. While sharing a common goal of facilitating savings, tontins differ in structure and risk from formal banking arrangements.