NEW DISCOVERY!!! Microfinance before Grameen

Well, maybe I’m not the first to discover that microfinance existed in Cameroon before the Grameen bank was founded in India or before Mohammed Yunnus got the Nobel Prize, but I felt like I had when I stumbled upon Njangi while talking to some friends over the weekend. The young people who I’ve met in Cameroon are all very intelligent and informed. The standard of education is excellent and radio commercials advertising excellent classroom facilities for young children frequent the radio. Conversation amongst the teens most often centers on grades from the last semester and I’ve yet to meet someone my age who does not plan to pursue at least one masters degree before finishing their education. At the same time that people generally agree here that you must get an advanced degree, cynicism surrounding job prospects is rampant. They swear that no one can achieve a decent position within a company unless they’ve got connections or they’re embezzling. In one of these conversations about the sad state of the nation, I asked my friends why it was that they still pursued advanced degrees and how it was possible for their parents, with families of five to nine children, to sponsor children over twenty years of school. It is a struggle for my family to support just me in college and there are only two children in my family. They said “Njangi!” and then started laughing.

Njangi, as I found out, is microfinance on a smaller scale. Groups of friends, neighbors, mothers of school-age children or motorcycle-driving men get together and pool money that they can then have access to for activities related to the mission statement of the group. Some of these groups have grown into such large and established institutions that credit unions sprouted from their meetings. These groups assign treasurers and leaders. They are based not only on finances but also on community and friendship. The trust amongst the members and the knowledge that without the Njangi groups, life would be a lot harder, brings honesty into the groups. My friends say their mothers get money for schooling, feeding the household and supporting the church all through their Njangi groups. It was a debate amongst them whether Njangi could be the sole source of income, but they pointed out that people “playing” Njangi could borrow from one Njangi and contribute to another and so on and so forth, in order to have access to loans from many sources. In terms of accountancy, I think this strategy is a little risky, but if people can manage paying everyone back in the end, I guess there is no problem. My friends have said that their friends, parents and grandparents all play Njangi, making it the main source of financing in the nation. It has been going on for generations from what I can tell. Apparently, it is illegal in Cameroonian law because it is tax-free and hard to track by the government, yet an estimated 7.5 out of all 15 million Cameroonians play and many towns wouldn’t survive without them. I thought I had stumbled upon some secret that would make a name for me in anthropology. Of course, upon minimal internet research, I found that some people had written on the subject before. One of my friends begrudgingly acknowledged that is was due to the low value that Cameroonian scholars place on publishing that led to the Nobel prize won by Yunnus. “If Cameroonians wrote anything down, we could win awards for the things we have been doing for years, but we don’t write!”

I sought to pursue the topic further. I asked my GHAPE colleagues what information they had about Njangi and found that our own office has its own Njangi! Some of the staff take part in up to five Njangi’s and the values can run up to 20,000 FCFA ($50 USD) contribution per month, which is 40% of their 50,000 FCFA ($125 USD) monthly salary. One of my colleagues who partakes in five Njangi groups explained the financial and scheduling obligations of each Njangi to me.

Njangi Group	FCFA Contribution	USD Conversion	% of Annual Income, 50K FCFA
GHAPE	11,000 FCFA/month	$27.50 USD	22%
Cow Njangi*	30,000 FCFA/year	$75 USD	5%
Neighborhood	Min. 500 FCFA/week	$1.25 USD	Min. 4.3%
Father’s Njangi	5,000 FCFA/week	$12.50 USD	43.33%
Njangi #5	2,000 FCFA/week	$5 USD	17.33%
Total per annum	552,000 FCFA	$1,380 USD	91.96%

*Cow Njangi pools 20 members annual contributions of 30,000 into a collective fund that buys cows, rice, and palm oil at the end of the year to distribute equally amongst all members. I assume it’s called “Cow” because that’s the largest purchase and main attraction/focus of the group.

The obligations and terms of withdrawal are different within each Njangi. Despite the calculations, the Njangi membership is worth-while, say the Cameroonians I’ve asked. While a meager 50,000 FCFA ($125 USD) per month barely covers basic needs, taking 92% out of the salary seems like a HUGE chunk. At times, my colleagues don’t have an extra 200 FCFA ($0.50 USD) in their budget to eat lunch. What an Njangi offers in a society with no social safety-net, however, is a small sense of security. If a member needs emergency funds or many hundreds of thousands of FCFA, they would need many months to amass that value. Educational fees would not be a possibility without this access to capital. It relies largely on good-will and social equity which makes it such an interesting field of study.

The GHAPE office Njangi has 12 members, despite there being only 8 people who work in the office. This is because people can enter the Njangi under multiple names, as long as they make monthly contributions per name. The single women in the office have multiple names because they don’t have families and they rely on their boyfriends for the majority of their expenses. Collectively, the GHAPE office offers 10,000 FCFA ($25 USD) of each members’ contribution to a pre-designated beneficiary each month. The remaining 1000 FCFA ($2.50 USD) is pooled into the emergency fund that can be borrowed from, but must be repaid with 15% interest. This is so interesting to me because it is becoming more and more apparent that EVERYONE relies on Njangi. As I mentioned earlier, some of the Njangi’s have grown so large that they are now credit unions and one of the advertised financial instruments offered is Njangi financing. Now that I’ve heard about Njangi, it seems to be popping up everywhere and every new person I question has something to say about it. I just can’t express how interested I am in this. I wish I had another whole Fellowship to study Njangi. Hopefully more extensive research can be done in the field in the near future. <http://www.kiva.org/about/aboutPartner?id=40>

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