What the Market Teaches: Ubuntu Economics and the Informal Exchange Traditions Africa Built

COMMUNITY POWER

The word “informal” is doing a great deal of work in international development discourse. It is used to describe the susu circle in West Africa — a rotating savings association in which a group of trusted members contribute a fixed amount at regular intervals, with each member receiving the full pot in turn. It is used to describe Kenya’s chamas, women’s savings and investment cooperatives that collectively manage billions of Kenya shillings outside formal banking systems. It is used to describe harambee, Kenya’s tradition of communal labor and resource mobilization for shared community needs. “Informal” frames these systems as precursors to real economics — as practices that communities fall back on before they access proper financial services. The framing is wrong. These are not approximations of Western economic institutions. They are economic institutions — with different governance structures, different accountability mechanisms, and different values at their core. The word “informal” tells us more about the limitations of the frameworks doing the describing than about the systems being described.

The Market as Architecture

The African market is not a place where goods are exchanged. It is a place where community is constituted. In Yoruba culture, the oja — the market — is governed by the Iyaloja, the Mother of the Market, a senior elder woman whose authority over market governance is as political as it is commercial. She mediates disputes, sets the conditions of fair dealing, and holds the memory of the market’s standards across generations. The Iyaloja is not a manager. She is a keeper of the social contract that makes exchange possible. In Igbo communities, women’s control over market trade was so structurally significant that colonial administrators repeatedly misread it — assuming male authority where female authority actually governed, disrupting systems they never understood, and causing the kind of catastrophic confusion that culminated in the Women’s War of 1929, when tens of thousands of Igbo women organized a general strike against British taxation policies that threatened their economic autonomy.

The market, across African communities, is simultaneously a commercial space, a social institution, a governance structure, and a health infrastructure. When the market is disrupted — by colonial reorganization, by structural adjustment programs that force the privatization of local trade networks, by the entrance of multinational retailers that undercut local vendors — it is not just commerce that collapses. It is the web of relationships, credit, mutual accountability, and community knowledge that the market has always carried. Understanding community power means understanding that the market was never just about money.

The Susu Circle: Rotating Credit as Community Banking

The rotating savings and credit association — known as susu in Ghana and among West African diaspora communities, esusu in Yoruba communities, tontine in Francophone West Africa, chama in Kenya, upatu in Tanzania, ajo in Nigeria — is one of the most widely distributed financial institutions in human history. It operates on a logic that formal banking cannot replicate: trust as collateral. A group of known community members commits to contributing a fixed sum at regular intervals. At each meeting, the accumulated pool is given in full to one member, rotating until every member has received. No interest charges. No credit application. No collateral requirement. The accountability mechanism is not a contract enforced by a court — it is social obligation enforced by relationship. You contribute because these are your people, and your people will contribute for you when your turn comes.

Academic study of rotating credit associations dates at least to the 1960s, when anthropologist Shirley Ardener published the first comparative analysis of the practice across cultures. What she found was a system that appeared independently in communities across West Africa, East Africa, the Caribbean, East Asia, and the diaspora — not because of diffusion, but because communities independently arrived at the same insight: that pooled trust generates more liquidity than any individual member could access alone. Kenya’s chamas have since evolved far beyond the basic rotating pot model. Women’s chamas now invest collectively in real estate, operate lending programs at competitive rates, fund school fees and medical emergencies, and function as political organizing networks. The Central Bank of Kenya estimates that chamas manage the equivalent of billions of dollars annually — outside formal banking, governed by women, accountable to their members. If the IMF designed it, it would be called a financial innovation. Because women in Kenya built it, it is called informal.

Harambee and the Economy of Reciprocal Labor

Harambee — Swahili for “let us all pull together” — describes Kenya’s tradition of communal resource mobilization for shared community needs. A school needs building. A family needs school fees. A community needs a water point. Harambee events bring community members together to contribute labor, materials, and money toward the shared need. The system is not charity — it is reciprocal. You contribute to my harambee today because the understanding is mutual: when your need arises, the community will come. The gift is never from one person to another. It flows through the community and back. Jomo Kenyatta adopted harambee as Kenya’s national motto at independence in 1963 precisely because it named an organizing principle that already existed in practice across communities — not because it was a government invention, but because it was a community reality that governance could recognize.

Reciprocal labor economies appear across the African continent under different names and forms. In Uganda and Rwanda, communal work parties — bulungibwansi in Uganda, ubudehe in Rwanda — organize community labor around shared infrastructure needs outside state or market frameworks. In West Africa, the dongo (also called communal farming in many areas) pools labor at planting and harvest, with households rotating through one another’s fields in a sequence that ensures everyone benefits and no family falls behind. These are not “survival strategies” of communities too poor to hire workers. They are sophisticated economic systems in which labor is a commons — pooled, governed, and distributed by community rather than sold on a market. The economic logic is different from capitalism, not inferior to it. What looks like absence from a Western framework is often the presence of something the framework was not built to see.

What the IMF Calls “Informal”

The word “informal economy” entered development discourse as a descriptor for economic activity that occurs outside state regulation and formal documentation. In practice, it became a frame that discounted the sophistication, scale, and governance of African economic systems. Structural adjustment programs imposed by the International Monetary Fund and World Bank on African governments in the 1980s and 1990s explicitly targeted “informal” activity for formalization — meaning the replacement of community-governed systems with state-regulated, market-integrated alternatives. The assumption was that formalization meant progress. What it often meant, in practice, was the disruption of systems that worked for communities in exchange for systems that worked for creditors. Trade liberalization undercut local market women by flooding markets with cheap imports their networks were not designed to absorb. Privatization of community resources removed them from collective governance. Financial formalization created banking systems that charged fees the susu circle never did.

Dambisa Moyo’s critique of aid dependency — that foreign aid undermines the development of local economic capacity — touches the edge of this problem without naming its full depth. The deeper problem is not just that aid creates dependency. It is that the entire framework of formal/informal economic distinction is ideologically loaded: it treats Western-style financial institutions as the standard against which community-built systems are measured and found wanting. When a chama manages billions of shillings outside formal banking, it is not operating in the informal economy. It is operating in an economy with different governance principles — principles built on trust, reciprocity, and community accountability rather than contracts, collateral, and interest rates. The question worth asking is not how to bring these systems into the formal economy. It is why the formal economy has not yet learned what these systems already know.

Market Women as Economic Architects

Across West and East Africa, women have been the primary architects and governors of market-based economic life. This is not a recent development or a function of circumstance. In Igbo society, as documented by scholar Ifi Amadiume, women’s economic authority over trade was structurally embedded — a recognized social institution, not an informal workaround. The Iyaloja system in Yoruba markets placed elder women in formal economic governance roles with real authority. Kenya’s chamas are predominantly women-led and women-governed. Nigeria’s market women’s associations have historically functioned as economic unions, credit networks, and political pressure groups simultaneously — organizing general strikes, negotiating with colonial and post-independence governments, and maintaining price governance across market systems that covered entire regions. These are not small-scale activities. They are the backbone of food distribution, community credit, and local economic governance across enormous geographic areas.

The systematic erasure of this authority is one of colonialism’s least-documented economic violences. Colonial administration assumed male governance and imposed it. Tax policies targeted market women specifically, as the Women’s War of 1929 documented in blood. Development frameworks that arrived in the post-independence era were often no better: designed by economists trained in Western institutions, they proposed solutions to problems they had misdiagnosed, for communities whose economic sophistication they had not bothered to study. Ubuntu Village’s programs are built from a different premise: that the communities we work with are economic experts, not economic problems. Market women do not need to be taught how to save, invest, or govern credit. They invented the systems the microfinance industry would later try to sell back to them.

Ubuntu Economics and the Commons

What unifies the susu circle, the chama, harambee, communal labor networks, and market women’s governance systems is not just practical organization. It is a shared economic philosophy: that resources governed collectively, in accountability to community, produce outcomes that individually managed resources cannot. This is precisely what Nobel Prize-winning economist Elinor Ostrom spent her career demonstrating — that communities routinely and successfully govern shared resources in ways that neither privatization nor state regulation achieves, provided the governance structures meet certain community-designed conditions. What Ostrom named as a discovery in 1990, African communities had been practicing for centuries. The commons — the communal field, the shared water point, the rotating credit pool, the collective labor party — is not a precursor to private property. It is a governance structure that serves different values: sufficiency over accumulation, accountability over anonymity, reciprocity over return on investment.

Ubuntu economics — the economic expression of umuntu ngumuntu ngabantu, I am because we are — is not an ancient practice waiting to be modernized. It is a living economic framework operating at scale across the African continent and its diaspora. The West African susu arrived in the Caribbean with enslaved Africans and has functioned in Black diasporic communities ever since. The chama model is being studied by financial inclusion researchers as a more effective vehicle for savings mobilization than anything formal banking has achieved at the community level. Harambee is recognized by development economists as a sophisticated community finance mechanism with higher completion rates for local infrastructure projects than government-contracted alternatives. The ancestral knowledge embedded in these systems is primary evidence — not supplementary tradition waiting for academic validation. The market already knew. The question is whether we are prepared to learn from it.

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If this named something you already knew was true, share it with someone who is still being told these systems aren’t real economics.

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Sources & Research

• Ardener, Shirley. (1964). “The Comparative Study of Rotating Credit Associations.” Journal of the Royal Anthropological Institute of Great Britain and Ireland, 94(2), 201–229.
• Bouman, F.J.A. (1995). “Rotating and Accumulating Savings and Credit Associations: A Development Perspective.” World Development, 23(3), 371–384.
• Amadiume, Ifi. Male Daughters, Female Husbands: Gender and Sex in an African Society. Zed Books, 1987.
• Ostrom, Elinor. Governing the Commons: The Evolution of Institutions for Collective Action. Cambridge University Press, 1990.
• Moyo, Dambisa. Dead Aid: Why Aid Is Not Working and How There Is a Better Way for Africa. Farrar, Straus and Giroux, 2009.

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Related Reading

• ‣ Community Power Building: Lessons from East Harlem, Kenya, Uganda, and Nigeria
• ‣ Decolonizing Global Health: Why “Capacity Building” Often Means Something Else Entirely
• ‣ Epigenetics and Ancestral Memory: What Your Body Remembers
• ‣ Spirit and Body, Science and Soul: The False Divide That Colonial Medicine Created

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