How Do People in Emerging Markets Save Money?
Emerging markets, encompassing low- and middle-income economies, present distinct obstacles to saving. Households often contend with irregular incomes, limited access to formal banking, periods of high inflation that erode the value of cash holdings, and the constant pressure of meeting immediate needs. Saving nevertheless serves as a vital tool for weathering unexpected costs such as medical emergencies or job loss, financing education or small businesses, and stabilising daily consumption over time. The World Bank’s Global Findex Database 2025, drawn from surveys of about 145,000 adults across 141 economies in 2024, shows clear progress in formal saving alongside the continued importance of informal and alternative methods.
Formal Finance Gains Ground: The Digital Savings Revolution
Account-based saving has expanded markedly in developing economies. In 2024, 40% of adults saved money in a financial account, a 16% rise from 24% in 2021. This represents the fastest increase in more than a decade. When those who save through other formal channels are included, the total share of adults saving reaches 55%, with an additional 15% using non-account methods.
Mobile money has played a central part in this shift. Ten percent of adults in developing economies now use a mobile-money account to save, nearly double the share recorded in 2021. With widespread mobile-phone ownership, digital tools have lowered barriers that once kept people reliant on cash stored at home. Mobile-money platforms allow small, frequent deposits through local agents, reducing the risks of theft or loss and integrating saving with everyday payments and transfers. In Sub-Saharan Africa alone, nearly one in four adults saves using a mobile-money account.
Regional patterns highlight the pace of change. In Sub-Saharan Africa, formal saving climbed to 35% of adults in 2024, up 12% from 2021. In Latin America and the Caribbean, the share of adults saving using mobile money increased by more than 10% to reach 19%. East Asia and the Pacific continues to record the highest formal saving rate overall, with the largest regional rise of 20% driven largely by gains in China. These developments reflect broader improvements in digital infrastructure and regulatory support for fintech. Formal accounts offer greater security and, in some cases, modest interest or linked services such as micro-insurance. Uptake still varies widely according to local income levels and trust in institutions, yet the data confirm that digital channels are closing gaps faster than traditional banking alone ever could.
Timeless Community Networks: Informal Savings Groups in Action
Despite the rise in formal options, informal savings groups remain widespread and often preferred for their simplicity and social dimension. Rotating savings and credit associations (ROSCAs) bring together a fixed number of members who contribute regular amounts into a common pot. The total sum is then distributed to one participant each cycle, usually by lottery or agreed rotation. No interest or paperwork is involved, and decisions rest on mutual trust rather than formal contracts.
Such groups appear under many local names. In South Africa they are known as stokvels; in Nigeria as esusu, ajo or adashi; in Kenya as chama; in Mexico as tandas; and in India as chit funds or self-help groups. In South Africa alone, around 820,000 stokvels involve more than 11 million people and hold collective savings exceeding R50 billion annually.
These arrangements provide more than financial discipline. They deliver social support during funerals or family crises, create collateral through group guarantees, and allow flexible timing suited to irregular incomes. The absence of fees and quick access make them attractive where formal banks impose minimum balances or documentation requirements. At the same time, they carry risks: a member may default, or the group may dissolve before all participants receive their share. Data on exact global participation remain patchy because the groups operate outside official records, but usage rates of 19% or higher among adults who save have been recorded in Sub-Saharan Africa in earlier studies. Many groups have adapted over time. In South Africa, for instance, roughly 20% of stokvels function as grocery stokvels, pooling funds to secure bulk discounts on household essentials. Similar adaptations appear elsewhere, allowing participants to meet both immediate needs and longer-term goals within the same trusted framework.
Diverse Landscapes: Regional Approaches to Saving Money
Saving practices reflect local economic conditions, cultural norms and infrastructure. Sub-Saharan Africa stands out for the rapid adoption of mobile money alongside enduring stokvels and ROSCAs. Mobile-money accounts have shifted some saving from home storage or community groups into formal channels, yet many households maintain both systems for different purposes, such as short-term needs versus longer-term goals.
In South Asia, community-based self-help groups often link to microfinance institutions, blending informal trust with gradual access to formal credit and saving. Latin America shows growing mobile-money uptake that supports formal saving, while traditional tandas and consórcios continue to serve rural and lower-income groups. Across regions, livestock in parts of Africa functions as a living savings asset that can be sold when cash is required, although it carries risks from disease or market fluctuations. In East Asia and the Pacific, higher baseline formal saving rates combine with strong digital growth, illustrating how regional contexts shape the balance between old and new methods.
Beyond Bank Accounts: Physical Assets as Savings Vehicles
When formal or group options feel out of reach, households turn to tangible items. Gold, livestock, property and even stored goods could provide inflation protection and cultural familiarity. In India, households allocate an average of 11% of their wealth to gold bullion, with 84% held in physical assets overall. One in ten households buys gold annually or more frequently, often in the form of jewellery, coins or bars. Recent estimates place the total value of gold held by Indian households at $3.8 trillion. Jewellery and coins serve as both a store of value and a hedge against inflation.
Such methods remain common where financial literacy is low or banks are distant. They also reflect deeper preferences: gold, in particular, carries social and ceremonial significance in many cultures. In parts of Africa, livestock serves a dual purpose as both savings and productive asset, though vulnerability to drought or disease can undermine its reliability. Overall, physical assets continue to form a substantial portion of household portfolios in emerging markets precisely because they align with immediate needs and longstanding traditions.
Remittances: A Key Driver of Household Savings
Remittances from family members working abroad or in urban centres represent another important channel for saving in many emerging markets. These flows often exceed official development assistance and foreign direct investment in several countries, providing a stable source of income that households can direct toward savings rather than immediate consumption. Studies in various contexts show that remittance-receiving households tend to save more in both absolute amounts and as a share of income compared with non-recipients. For example, research in Vietnam found that such households saved between 16.8% and 20.7% more of their income after accounting for other factors.
Remittances frequently support targeted saving for education, health, or small business investments. In Latin America and parts of Asia and Africa, recipient families allocate a higher share of marginal income to these productive uses than to everyday spending. This behaviour helps build longer-term resilience, although the exact portion saved varies by country, household size and economic conditions. Digital transfer platforms have made remittances faster and cheaper, enabling smaller, more regular deposits into formal accounts or mobile-money wallets and further encouraging saving habits.
Fintech Innovations Expanding Options
Beyond basic mobile money, a wave of fintech applications is broadening saving choices in emerging markets. Micro-investing apps, automated savings tools and digital wallets now allow users to set aside tiny amounts regularly, often with features such as round-up spending or goal-based saving. These platforms lower entry barriers for young people and low-income earners who previously found minimum deposits or fees prohibitive. In countries such as Brazil, India and Kenya, fintech providers have integrated savings with payments, remittances and even small loans, creating seamless experiences that encourage consistent behaviour.
Early evidence suggests these innovations complement rather than replace traditional methods. Many users maintain informal groups for social purposes while using apps for secure, interest-bearing storage. Regulatory frameworks that support interoperability between fintech and banks have accelerated adoption, although challenges around data privacy and digital literacy remain.
Cryptocurrency Emergence: Digital Assets as Savings Tools
Crypto has gained traction as an alternative savings vehicle in many emerging markets, driven by the need for inflation protection, easier cross-border transfers, and access to dollar-denominated assets without traditional banking. According to the Chainalysis 2025 Global Crypto Adoption Index, emerging markets dominate the top rankings, with India in first place, followed by Pakistan, Vietnam, and Brazil. On-chain crypto activity in Asia-Pacific grew 69% year-on-year in the 12 months to June 2025, while Sub-Saharan Africa recorded a 52% increase, reflecting heavy use for remittances and everyday payments.
Households in these regions often view crypto, particularly Bitcoin or other volatile assets, as a long-term store of value when local currencies face depreciation. Adoption is especially pronounced where banking access is limited or capital controls exist, allowing individuals to bypass restrictions and preserve purchasing power. Data indicate that crypto functions more as a practical tool than pure speculation in these contexts, with volumes holding steady even during global market downturns.
Stablecoins: The Preferred Crypto Vehicle for Saving and Remittances
Stablecoins, pegged to major currencies such as the US dollar, have become the dominant form of crypto used for saving and transactions in emerging markets. Simulations by S&P Global Ratings suggest that foreign-currency stablecoin holdings across 45 emerging-market countries could expand from around $70 billion currently to between $250 billion and $730 billion, depending on adoption scenarios. These assets serve as a hedge against inflation and currency volatility while facilitating low-cost remittances.
In countries such as Nigeria, Turkey, Venezuela and parts of Latin America, stablecoins act as a shadow dollar system for daily saving and payments. They reduce remittance costs dramatically, for instance from several dollars to fractions of a cent for transfers, and enable faster settlement than conventional channels. Users store value in stablecoins via mobile wallets, often integrated with local fintech platforms, to protect against local-currency erosion while maintaining liquidity. This approach complements mobile money and informal groups, providing an additional layer of resilience in economies prone to monetary instability.
Catalysts of Change: Technology, Policy, and Everyday Realities
Several factors explain the recent acceleration in formal saving, including the rise of crypto options. Widespread mobile-phone ownership has cut transaction costs and extended services to remote areas through agent networks and digital wallets. Government policies promoting digital payments and financial education have reinforced this trend. Economic pressures, including income volatility and the need to manage remittances, further encourage the use of accounts, mobile money and crypto tools that allow instant transfers and value storage.
Mobile-money activity rates have also risen steadily. In many countries, regulatory frameworks now support interoperability between mobile-money providers, traditional banks and crypto platforms, smoothing the path from informal to formal saving. Crypto and stablecoin adoption adds another dimension, particularly in high-inflation settings where they provide accessible alternatives to physical assets or cash hoarding.
Nevertheless, challenges persist. Nearly half of adults in developing economies report they could not cover one month’s expenses in an emergency, indicating that saving volumes remain modest even when accounts or digital assets exist.
Persistent Hurdles and Future Prospects
People in emerging markets combine formal accounts, mobile-money tools, community groups, physical assets, remittances and now cryptocurrencies to meet their saving needs. The sharp rise in formal saving since 2021, propelled by mobile technology, fintech and crypto innovations, marks genuine progress toward greater financial resilience. Informal methods endure because they address gaps in access, cost and trust that formal systems have yet to close completely. Crypto introduces new opportunities but also risks, including price volatility for non-stable assets, regulatory uncertainty, cyber threats and potential capital-flow pressures on local economies.
Continued expansion of affordable digital services, improved financial education and policies that link informal groups, fintech and crypto platforms to regulated institutions could widen the benefits. Understanding these layered approaches reveals how households navigate uncertainty and plan for the future in varied economic settings. As innovation and policy align more closely with everyday realities, the potential for deeper and more inclusive saving grows.
Risk Disclosure
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Disclaimer: Views expressed in this article are the personal views of the author and should not form the basis for making investment decisions, nor be construed as a recommendation or advice to engage in investment transactions.
