Also known as a tanda, a cundina helps members save more than they might on their own and access interest-free loans. In English, cundina translates to “rotating savings and credit association” or “money pool.” Common in Latin American cultures, especially in Mexico, it’s a system where a group regularly contributes money to a shared pot, and each member receives the total amount once during the cycle. It’s a form of mutual aid, helping members save and access funds when needed.
Each week (or other set interval), members pay a fixed amount into the pot. One member receives the full sum, and the process repeats until everyone has had a turn.
The Key to a Successful Cundina: Trust
The foundation of a cundina is confianza, a deep sense of trust and intimacy. There are usually no formal contracts, only mutual Ïunderstanding. Because these circles often form among family, friends, co-workers, or neighbors, the risk of fraud is low. Taking the money and disappearing damages personal relationships and cuts people off from vital support networks.
According to Investopedia, cundinas function as “informal financial institutions.” The “rotating” aspect means each person eventually receives a payout. Those who get their money early effectively receive a no-interest loan (credit), while those who receive it later are saving up over time.
No matter when someone receives their payout, they must continue contributing each week (or as agreed: biweekly, monthly, seasonally).
Why Join a Cundina?
Besides financial support, cundinas offer a chance to build social connections. Organizers set the rules: how many people join, how long it runs, and how much each number (or slot) costs. The number determines when a member receives their payout. For example, if you’re assigned number 4, you get your payment in the fourth week.
Participants can buy multiple numbers. The more numbers you buy, the more you pay weekly. To calculate the weekly payment, divide the value of one number by the number of weeks. Multiply that by however many numbers you buy.
Organizers often keep the first number as a safeguard, ensuring they’re committed from the start and discouraging dropouts.
How to Start a Cundina in Your Community
1. Set Clear Parameters
Before inviting anyone, define your cundina’s rules:
- Start and end dates
- Payment and payout schedule
- Number of participants (and corresponding weeks)
- Cost per number
- Decide how you’ll collect and distribute money. (Many prefer cash.)
2. Choose Trusted Participants
Only invite people you know well and see often, friends, family, or coworkers. The ideal group size is 10–20. Fewer than 10 makes payouts small; more than 20 can drag out the timeline.
3. Is It Legal?
Yes! Cundinas (or tandas) are legal. While not regulated by the government, they are based on informal agreements. That means disputes can be hard to resolve if someone breaks the rules. They’re not part of formal banking, but no laws prohibit them.