Finding the Right Balance: Financial Self-Help Organizations as Sources of Security and Insecurity in Urban Indonesia

Abstract

Financial self-help organizations can be found in many parts of the world, and the cities of Java are among the areas where they are particularly widespread. Since about the 1950s, interest in these institutions among anthropologists and development sociologists has increased considerably. Analyses of financial self-help organizations have most often focused on their economic or their social function; few scholars have pointed to their function as providers of security and identified self-help organizations as typical forms of local social security institutions. The main shortcoming of most of these studies is that they base their conclusions solely on an analysis of the financial arrangements provided by these self-help organizations, neglecting the accommodating practices that people undertake in order to fit the provisions of self-help organizations to their own household needs. This essay explores the observation that financial self-help organizations do not simply provide security through the different kinds of insurance mechanisms they might contain, but that, particularly through the way in which people use them and participate in them, these institutions become meaningful for coping with insecurity. It examines the question of whether participation in financial self-help organizations contributes to the ability of households to cope with adversities and deficiencies in a concrete social context. Research aiming to answer this question was conducted in Bujung, an urban ward on the outskirts of Yogyakarta, on the island of Java.