Thrift collection popularly called ‘Ajo’ or ‘Esusu’ is probably the earliest form of banking. It is a special kind of micro finance banking business currently practiced in most neighborhoods and marketplaces. This kind of savings and (sometimes) loan business is very popular among communal dwellers. It is a business of trust and integrity and very few people have what it takes to be successful in thrift collection business. The business rely so much in number and it is extremely profitable. That is why I want to talk about it today.
First, I want to apologize for the long sabbatical leave of absent or whatever I may call it that I and Wealth Result have suffered over the past 10 months. It has been more than ten solid months since I last published posts on this website on regular basis. I know there are people who come here regularly to check on me/us, and I know that some people look up to the business ideas we share on this website. So, staying absent for almost a year wasn’t what I planned for, it just came unannounced and I had to embrace it. From now on, we hope to be dishing out some of the brightest business ideas and survival strategies in town. If you haven’t been following us on Twitter, you need to do that now or you miss out!
I will explain to you guys in detail the reason we stayed incommunicado for so long but for now, let’s get straight to the business of the day. This business I want to write about today is a business I know too well about. I have done it before and I know exactly how it works. So, this is based on personal experience.
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Starting a Thrift Collection Business is very simple and down to earth. You do not need much investment, you may probably not need to rent any facility for it, all you need is your personal reputation, marketing ability, time, and consistency. If you have all these, you are perfectly good to go. Lets look at the potential profit and possible risks –
This is a money business and as such, there is good profit in it if well managed.You don’t really make much profit from the business itself but from what you do with the money within the period the money is in your possession. So, if you are good at managing funds and you manage the money well, you will make a very good profit.
Traditionally, you take whatever amount the depositor is saving with you daily, you take one deposit out of the 30days in a month. At the end of the month, you pay the depositor 29days value and take one day value. This in itself is not a huge profit because, if you have 100 people saving N200 daily with you, your take home at the end of the month will be N200 x 100 = N20,000. This is not off the roof considering that you’d have to go out everyday to collect those funds.
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Now, where is the profit? Like I said earlier, the profit is in what you do with the money you collected before paying it back to the owners. This is quite tricky and simple at the same time.
#First – Try to get most of your depositors to save from six months to one year, This is the strategy I used during my own time to get people to leave their funds with me for longer period of time. I did that by promising some incentives such as non deduction and opportunity to get small loan based on the overall amount of savings.
#Secondly – Look for a very profitable, I mean extremely profitable business you can invest the funds collected into. You have to be very careful about this because business can be very tricky and risky sometimes. Do not put it in businesses that takes time to mature, business like grocery store in a very busy location or wholesale in any moving product is very ideal. This is where the profit will come from!
1. Criminals – Like every money business, the danger of being attacked by robbers and hoodlums is always there, especially if you do collect large sum everyday. You have to device means of conveying your money in a secure manner.
2. Friends and Family – Once they know you collect money on daily basis, they don’t want to know how delicate the fund is, they would
want you to use it in solving their own problems first. Some will come for loans and insist they will get it, after all, there is money in your hands. They will begin to come up with useless business ideas hoping to finance it with the money you collect.
You need to be firm, extremely firm in your decisions never to borrow anyone from the money because if you do, then prepare to go to jail since it’s obvious they wouldn’t pay.
3. Lack of Self Discipline – You may as well be the greatest danger in your business. Once you have the money in your hands, you begin to dream big in the negative ways – you start engaging in frivolities, showing people you have arrived on top of people’s money.
Please if you know you lack self discipline and proper management skills, do not disgrace yourself by going into thrift collection business. This business is exclusively for decent, well respected people.
4. Poor Decisions – You starts getting people’s money and you begin to think about unrealistic businesses. Invest only in business that is realistic and profitable, a business you have the time and knowledge to manage very effectively.
Very simple! Probably the simplest business anyone can start but it requires hard work and good marketing skills. To get started, you need the following things in place:-
1. Record Cards – Sorry I have discarded all my cards, I’d have uploaded the picture for you to see but, if you have done anything with Ajo people before, you should know the type of card I’m talking about. It is the card given to the depositors, where the thrift collector used to record the payment made by the customer each day. If you haven’t seen it before, ask around you must see one or two persons who may give you the sample to see.
Print about two hundred copies or any number of prospective customers you think you can reach. Some people use to collect N50 from new customers before giving out the card, you may give yours for free as I did during my own time.
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2. Cash Register – It is not just enough to register the money collected on the depositors record card, you need to register it on your cash register too. Every entry has to be accurate and signed by you on both record books
3. Sales Girls/Boys – Many have been maimed in this business by the sales girls/boys they hired. If you are to employ the service of sales persons who will be in charge of marketing and collecting the funds, you must hire from your family. Such person must be a close trusted family member with good track record. This business involves handling of money on daily basis, do not hire strangers to do this for you.
4. Business Cards – This is part of your marketing strategy. You need a business card you can hand out to potential costumers.
Start your marketing from people that know and trust you. Thrift collection business is a business that thrive on trust, you must do everything you can to win and keep people’s trust. Your family and friends are good way to start and gain the needed confidence, then you expand to the market women, okada riders, shop owners and workshops within your neighborhood.
If you are able to do all things and do it well, you can be rest assured that Osusu business is a business to recon with.
Have you done this business before or you are currently doing it? Do you have anything to add? Feel free to drop your comment below, be of help to others.
Good day sir.i want to find out from you if there is any license that one need to have from government while doing this ajo business,to avoid harassment.regards
You will have to register your copertaive with the state you intend to start in.
I can help you out with the registration
i am a software developer in an IT company.
We have developed software to help Osusu / Cooperative to manage their businesses properly.
Amosco: Reach me on emotionreal[at]yahoo.com. I am interested in the software
If you are interested in seeing or having a Demo of Osusu / Cooperative Management Software, reach me
If you are interested in seeing or having a Demo of Osusu / Cooperative Management Software, reach me on akpor2012[at]gmail.com
I am interested in the demo of cooperative management software.
can share your contact number ?
I am into the business. ..pls I need a software to keep my records in proper perspective. 09085197720 is my number.
Hope to hear from pls.
Can you send your information to me on my email email@example.com
No, Emmanuel you do not require any local or state licence to operate a thrift collection business. All you need is TRUST, SELF DISCIPLINE and Financial Intelligence.
With these you can begin your marketing and you are in business!
Please which body is in charge for the registration of Thrift collection in Nigeria
i am a thrift collector in Oyo state…ajowithadeife. Please feel free to follow me on instagram
I am currently doing the thrift business in awka anambra state, my lawyer adviced me to register it by guarantee, some I could operate anywhere in the country, thanks for the advice
Sorry, how do you mean register with guarantee?
Please i have interest in starting up Esusu by next month, Feb 2018 and my intention is to employ someone who will be in charge of collecting the money daily and she is a stranger that i doesnt know but i will make sure that she give me two solide guarantors. Please i need ur advice on my decision
We are set of programmers and we develop softwares..we can help you develop softwares to help monitor inflow and outflow of your money thanks..contact 07087831254
I run a monthly AJO scheme and I have being on it for a while now, the way mine works is I have a group on whatsapp that everyone joins and payments, monthly allocations and reminders are sent. But I want to know how much do I charge for admin fee factoring bank charges and the likes. I started out with friends but now I want to do a business put of it. I am running 10groups at the moment.
Brother hi, how can I reach I am doing this right but I want to know your idea, u can reach on 08063807475
Nice. I want to go into this fully but I want to register to get some license
Just the information I was looking for. thanks for sharing
Gudmorning, pls am interested in starting the ajo business come February next year.pls I need ideas on record keeping and software. Thanks. Bukola.u can reach me on 08182796575.
i just started but i don’t know much about it.
Thanks for this post. Please is there a body that handles the registration asides the regular company regoistration at CAC. is thera licence needed and who regulates this?
Sorry, how do you mean register with guarantee?