laaduna

Laaduna is a term that refers to a traditional practice found in some cultures, particularly in parts of Eastern Africa. It is a form of social insurance or mutual aid where members of a community contribute a small amount of money or resources regularly to a common fund. This fund is then disbursed to a chosen member or group of members at specific intervals, typically on a rotating basis. The purpose of laaduna is to provide financial support for individuals or families facing significant expenses, such as weddings, funerals, education, or business investments.

The structure of a laaduna group can vary. It is often informal and organized within families, neighborhoods, or social circles. Members typically agree on the contribution amount and the frequency of payouts. The selection of who receives the funds can be determined by a lottery, a pre-arranged schedule, or by a consensus within the group. This system fosters a sense of community solidarity and collective responsibility, ensuring that individuals have access to financial resources when needed without having to rely solely on formal financial institutions. Laaduna plays a crucial role in supporting livelihoods and strengthening social bonds in communities where access to credit may be limited.