Pakistan is a developing country. The credit associations here are not well established. The means of saving still needs proper attention of authorities to improve it. That’s why people are not attracted to formal organizations. They usually try to save in informal organizations. In the same way the present study also focuses to find the reasons how informal saving groups like ROSCA (Rotating Saving and Credit Associations) are much popular in the rural areas of Pakistan. Many researchers have done their valuable works inside and outside the Pakistan from different angles but this study attempts from another angle and provides new hypothesis to the readers. Cross sectional data has been collected through questionnaire from the people living in rural areas of Pakistan. Salaried class and self employed class are interviewed separately. The data has been analyzed by a simple linear regression model. The empirical results of the study show that ROSCA is much popular in both salaried and self employed classes. Variables taken enter the model statistically significant showing the reasons that how informal self help groups are popular in the study area.
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