/ 15 March 2024

Ancient community banking enters digital age in Cameroon

Gettyimages 2068302993 594x594
This photograph taken in Yaounde, on February 17, shows the Djangui Money logo on a mobile phone. In many African countries, the tontine is a popular collective savings system which has for years enabled those to whom banks do not lend to finance a project or an emergency. In Cameroon, start-ups have brought it into the digital age in recent years. (Photo by Daniel BELOUMOU OLOMO / AFP)

Joseph Ngono’s face lights up as he looks at his smartphone, where a payment of $830 has just appeared in his digital wallet. Like many Cameroonians, the computer scientist pays in each week to a shared savings fund known as a “tontine” — an ancient system that start-ups are now bringing into the digital age.

The system of “pooling savings … between people united by connections of family, friendship, profession, clan” existed “long before the introduction of money”, said a 2020 report published by the Global Development Research Centre. It lists 30 African countries where tontines are used and 14 in Asia. In South Africa, it’s known as a stokvel.

This week it has paid out 500  000 Central African francs to Ngono, who will use it to cover the final instalment of his children’s school fees. “Without it, they wouldn’t go to school,” he said.

Shunned by banks, many people in Cameroon turn to their communities for help in the form of tontines, such as the one Ngono uses through the smartphone app Djangui. In its most common form, members pay money into a common fund and take turns collecting it after an agreed period — and it’s interest free.

Every week Ngono, along with colleagues and strangers whom they sponsor, contributes FCFA 10 000 ($16) each on Djangui. It gives crucial access to ready cash for Ngono — he only occasionally receives his monthly salary of $250 because his employer is “experiencing some cash-flow difficulties”.

Launched in 2016 by Guilain Kenfack, Djangui was one of the first tontine apps in the country. 

Since its creation, Kenfack said the app has gained 50  000 users. 

A number of imitators of Djangui have sprung up. As in other countries in Africa, many Cameroonians struggle to get loans from banks.

The African World Institute wrote in a 2019 report that 85% of people on the continent are “excluded from the banking system”. In Cameroon and elsewhere the average interest rate for loans to individuals was 10% in 2022, according to the Bank of Central African States.

The tontine “replaces the bank” and allows “informal economic players” to make expenditures or investments, said Omer Zang, the founder of an NGO that supports tontines.

The digitised saving systems have attracted the interest of banks, including Cameroon’s Afriland First Bank, which offers customers the chance “to tontine”.

But online tontines can be risky because people can register under false identities. Civil servant Paul Kemayou lost $1  700 in an online tontine. This is why some Cameroonians keep to the traditional tontines.

“I prefer the tontines where people meet in person,” said shopkeeper Emmanuel Talla. “We know each other, the old and the young get together. The relationships are about more than just money.”