Understanding mutual aid: James Midgley
Mutual aid associations, comprising groups of people who pool resources for a variety of social protection purposes, are a key component of the wider ‘non-formal’ social security system which was mentioned in the Introduction to this book. In addition to helping poor people respond to adversity, some play an important role in facilitating savings and accumulating capital. Others specialize in providing credit. However, there is a great deal of overlap so that one type of association may, in fact, provide a service typically associated with another type. Similarly, while social science research suggests that mutual aid associations are characterized by informality, spontaneity and flexibility, they are very diverse. Many have adopted formal operating procedures, some have become large and impersonal and some have evolved into organized microinsurance organizations. The formalization of mutual aid and its transformation into microinsurance is a topic of growing interest to social security scholars and policy-makers today who are seeking to extend coverage to the majority of the South’s population who are excluded from statutory schemes. Formalization is also of interest to nonprofit organizations seeking to alleviate poverty, and to commercial providers who are increasingly being persuaded that mutual aid is amenable to marketization.