Tontines: The modernized traditional system aiding Cameroonians financiallyCameroonian computer scientist receives $830 payment through digital tontine

Joseph Ngono's face is filled with joy as he gazes at his smartphone, witnessing a payment of $830 that has just arrived in his digital wallet. Similar to many other Cameroonians, this computer scientist contributes to a shared savings fund known as a "tontine" on a weekly basis - a traditional system that is now being modernized by start-ups.

This week, Ngono received a payout of 500,000 Central African francs from the tontine, which he plans to use for his children's final school fees installment. Due to the lack of support from banks, many people in Cameroon rely on their communities for assistance through tontines, such as the one Ngono participates in via the Djangui smartphone app.

In its most common form, tontines involve members contributing money into a common fund and taking turns withdrawing it after an agreed period, without any interest. Every week, Ngono and his colleagues, as well as strangers that they sponsor, each contribute 10,000 FCFA (equivalent to $16) on Djangui. This provides Ngono with access to immediate cash, especially since he only receives his monthly salary of 150,000 FCFA ($250) sporadically due to his employer's financial struggles.

According to a 2020 report published by the Global Development Research Center, the concept of "pooling savings... between people united by connections of family, friendship, profession, clan" has existed long before the introduction of money. Tontines are currently used in at least 30 African countries and 14 in Asia.

Djangui, launched in 2016 by Guilain Kenfack, was one of the first tontine apps in the country. Since its inception, the app has amassed 50,000 users, according to Kenfack. Numerous imitations of Djangui have emerged, and now there are multiple apps available in Cameroon that offer tontines online.

As is the case in many other African countries, obtaining loans from mainstream banks is a challenge for many Cameroonians. The African World Institute reported in 2019 that 85 percent of individuals on the continent are "excluded from the banking system." According to the Bank of Central African States (BEAC), the average interest rate for loans to individuals in Cameroon and other countries in Africa was 10 percent in 2022, and it can exceed 20 percent in other parts of the continent. Banks also rarely provide credit to those with small and medium incomes.

According to Omer Zang, founder of Social Brokers - a Cameroonian NGO that supports tontines - these saving systems serve as a substitute for banks and allow "informal economic players" to cover necessary expenses or make investments. The digitized versions of tontines have caught the attention of major banking corporations, including Cameroon's Afriland First Bank, which offers customers the opportunity to participate in a tontine.

However, there are still risks involved with online tontines, as individuals can register using false identities. This is why some Cameroonians prefer to stick with the traditional tontine system.

Ann Castro
Ann Castro Author
Ann Castro carries a total of 7 years experience in the healthcare domain. She owns a Master’s of Medicine Degree. She bagged numerous awards by contributing in the medical field with her ground-breaking notions. Ann has developed her own style of working and known for accuracy in her work. She loves trekking. She visits new places whenever she gets free time.