People would organize into groups and give a rotating treasurer portion of their income on a daily, weekly, or monthly basis. The treasurer changes with each round of deposits.
This traditional form of such a group is usually known as an Association of Persons (AOPs), wherein these persons can be legal or natural entities, as in establishments or individuals. The specific form of an AOP in which all participants are individuals is often referred to as the body of individuals (Bois).
These persons and individuals are brought together by a common objective, which in this case is the facilitation of savings, social collaboration, and financial planning.
In Arabic, this form of AOPs and Bois is called a “Jam’iyeh” which literally translates into to “association”, or in some specific cases “society”.
The concept itself is relatively foreign to the world of financial technology (FinTech), especially at the social level. Though it somewhat resembles pension and investment funds, this form of association is usually short-term, not exceeding a year.
Families in Jordan, as well as across the Arab World, have often resorted to savings associations to help finance their household needs; from buying new land, cattle and home appliances, to construction, weddings, new cars, and just about anything the family needs.
Within corporate settings, the practice also takes place among employees to help cover substantial upcoming payments or finance their households rather than resorting to banks and loans.
So far, it has worked, and though many prefer not to reinvent the wheel, a number of young Jordanian entrepreneurs from Madaba and Amman thought maybe they should.
In the conventional savings AOP, there is always the risk of someone falling behind on payments or just disappearing after their turn comes to cash in the money. Although it is less likely to occur in a traditional social setting, such as the neighborhood community or family, it could possibly occur in the not-so-conventional corporate workplace.
The core pillar of these associations is trust, both in the persons participating and in the association itself, as an organization, CEO and Cofounder of Kemlat Suleiman Tous told Jordan News.
“With new technologies at hand, we can facilitate a safer, easier and more secure mechanism for such associations, while turning them from unofficial BOIs to AOPs, by involving the employer in the savings association,” he explained.
Kemlat, is a Jordanian entrepreneurial limited liability technology solutions company, officially registered in 2020, introducing a new FinTech solution, aimed at organizing and securing savings AOPs in a corporate setting, for now, through a smartphone application that is connected to the company’s human resources administrator on the back end, according to the company CEO.
The founders of Kemlat first started working on their project back in 2019, and have since gone to market with a pilot operating at a select number of companies in Jordan, in preparation for their big launch in the next few months.
Suleiman Tous, Omar Mango, Mohannad Saed, have a strong sense of what works in their sector and what does not.
“Kemlat — the idea — has been under development for more than a year, and the application for some 9 months, and is now up and running live,” Tous added.
Two other competitors in Jordan and Egypt have immerged and since then disappeared, which Tous explained as due to the fact that these applications lacked the security that Kemlat provides by working through the employers’ own HR administrator.
“Involving the HR admin makes the whole association process safer and more organized. Aside from our technologically advanced application, which was developed in partnership with a Jordanian employee-owned cooperative company, this is our most effective advantage,” he underlined.
Bazian, A. (2021). Jordanian entrepreneurs ‘Kemlat’ reinvent saving AOPs. Jordan News. https://www.jordannews.jo/Section-30/Entrepreneurship/Jordanian-entrepreneurs-Kemlat-reinvent-saving-AOPs-2899