People have been solving their money management problems in diverse ways for a long time. They have invented a variety of solutions to saving and borrowing that do not fall into the sphere of regulated formal institutions and these are known as informal financial service mechanisms. They include savings clubs that people run themselves, savings clubs that are managed by other people, e.g. religious or welfare organisations or paid commercial managers, and informal providers such as money lenders, pawnbrokers or deposit takers. Informal mechanisms are still the most important in many poor communities and development workers would do well not to dismiss them as inappropriate or exploitative as they are often vital to people’s livelihood strategies. In fact there is now considerable interest in encouraging supplier finance, and user owned and managed groups or self help groups are widely promoted. These mechanisms are particularly important in rural areas where formal financial institutions still have difficulty providing cost effective services.