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Six steps to creating a successful chama

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Many self-help groups (or chamas) are created by never go far. While many disintegrate, some end up being empty talking shops. Kamuiru Group shares tips on how to create an effective self-help group.

  1. Set economic standards

Every interested person must have a source of income that guarantees payment of monthly contributions. David Irungu, chairman of Kamuiru Self Help Group, says when you allow in people who do not have means, the chama will fail. A chama is first the contributions, before the investment.

  1. Conduct a lifestyle audit

Well, would you trust your investments with people you don’t know? It is not enough to just know their names, find out where they come from, where they live, what they do for a living, and their spouse(s). All members of the group should have sufficient information about each other to avoid any surprises. This ensures that everyone has the same vision and mission and that no criminals disguise themselves to swindle members.

  1. Draft a Constitution

A constitution is the group’s guide. Once this has been drafted and approved, every member gets a copy which they sign ad commit to the terms and conditions. Even better, they have to agree to the investment strategies set forth.

See Also: A model chama that’s minting millions for members

For example, at Kamuiru Self Help Group, all members are not just required to sign copies of the agreement, but their spouses MUST sign as well. This ensures inclusion of the family unit in the chama, so that in case of anything the spouse is aware.

  1. Register your group

All Self Help Groups should be formally registered by the county government of Kenya. After drafting your constitution, you are now a group with a solid direction good enough to be formally recognized and listed by the government.

Legally registering of the chama also gives the body powers to transact business in its name. For example, Kamuiru Self Help Group recently purchased a parcel of land in their name.

  1. Mind each others’ business

The group was created to foster economic empowerment among the members. Start by supporting each others’ business. If there are members who run a business complementary to another then they can merge and work together. For example, one member of Kamuiru Self Help Group runs an eatery, and another runs a boda boda business, the boda boda guy delivers food supplies to the eatery.

Read: Investment guide for beginners that has worked for many

Businesses usually intertwine, where there’s a way one can complement the other. This goes back to knowing your chama members very well, so you can determine how you can support each other.

  1. Elect officials

The three most important slots for anybody should be filled – Chairman, Secretary and Treasurer – for accountability and organisation. Roles under these titles should also be defined, written down, and put in a document (preferably the constitution) so that every official understands and agrees to their scope of their work.

“I ensure every strategy we have laid down is met, and the group is well functioning. However, we are a group of friends, with similar goals and desires, and so a lot of teamwork is evident,” says Mr David Irungu, Chairman of Kamuiru Self Help Group.

Next: How to secure your financial life using loose change

A few extra points to ensuring a successful chama:

  • Lookout for professionals in matters business and finance, and invite them to attend your meetings and offer financial advice. For example, Kamuiru Self Help Group works closely with officials from Equity Bank and Youth Enterprise Development Fund.
  • Table-banking: The money collected should not just sit in the account waiting for investment ideas. Let members borrow and pay back with interest. This is how many chamas grow. By the end of a year, the money saved will probably have doubled, depending on how much interest was set.
  • Start a welfare saving account, from which members can borrow. This account should be separate from the usual chama account. The logic here is spreading your investments in different baskets. Where, for example, if you decide to purchase land, you don’t have to dip your hands in the same single account members have to borrow from every time. Spread your eggs in different baskets.
  • Get a regular meeting place, and a set date for meetings. Also, set a fine for late coming and absence without apology.


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Victor kauna

Thanks for the advice,,, was reading about how to do a successful group and now I have an idea.. The Lord bless you..

Penina Waithera

Thank you for your advice looking forward into starting a chama,with my area youths I hope t will be successful.


Thank yo so much. We are starters and the article is of great meaning, looking forward to more info.
We have already registered and doing our savings as well the Merry-go round.

Mariah wambui waruinge

Well educative


Cyrus wachira
This is wonderful .. I thank you alot for motivation, all supportive ideas .. am in seekers self-help group

Morris Khaguli

Morris Khaguli
Thank you for this outline as it has touched on quite a number of issues our aspiring chama group wanted to know.

Elvis otieno

Very inspiring


Thanks alot, I have learnt new tips to implement our chama👍