What are tandas?

5 minutes read
  • What is a tanda
  • How do tandas work?
  • Are tandas worth it?

What is a tanda?

Tanda is the most common name for lending circles in Latin America; these help people raise money in groups and are commonly organized in a friends and family circle.

How do Tandas work?

Tandas are a savings tool that works like a lending circle. Imagine that 12 friends decide to organize a tanda of a $10 monthly contribution. Each friend will choose a number, which will be the month in which he/she will receive the full savings. This way, each friend will have their turn receiving the total savings during the month that corresponds to them.

Are tandas worth it?

Tandas are a very simple savings tool. Your money will not generate interest, and there is no liability if any participant leaves the circle. Although, you will receive less money than initially agreed upon if that happens. On the other hand, tandas are a very informal arrangement in which you can save money without having to go to financial institutions that may charge interest rates.


When considering entering into a tanda, keep in mind that it is a tool that can end in theft or fraud. If you do not trust the group of people who are in the tanda, I would not recommend you to enter it considering the success of the tanda depends on all the participants. Tandas are an excellent option to save money in a very simple way without  fees, as long as it is organized by a group of people you trust.


Daniel Quiroz

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