Stokvels are South Africa’s top saving system that also bring friends and family together and provides support for bereaved members.
According to the National Stokvel Association of SA, there are more than 11 million stokvel members and R44 billion is collectively saved in 820,000 stokvels in South Africa annually.
The association has said that, if harnessed correctly, stokvels could be the driver the country needed to significantly enhance discretionary savings levels to bolster the economy.
Moses Ndaba, secretary of Maroma Social Club, said their stokvel has 26 members, who played for the same soccer team during their youth. Their stokvel has been running for four years.
Their football outfit was called Roman Chiefs in the early 1980s and was based in Winterveldt. Maroma was the team’s nickname so they used it for their stokvel.
“We formed the club not only to put some money away for rainy days, but also to come together regularly for a good time and provide financial and emotional support to members with emergencies or bereavement,” he said.
They meet once a month and members contribute R250, part of which is for catering. The host gets R1 250 and the rest goes into the bank.
The group withdraws and shares a portion of the interest earned at the end of each year, but the lump sum, which exceeds R250,000, is not touched.
Nedbank’s research into stokvel savings found they were worth more than some of SA’s largest businesses.
Gauteng has the most stokvels, followed by Limpopo, North West and KwaZulu-Natal. These four provinces account for 70% of the stokvels in SA.
Women are the majority members at 57%.
The most popular stokvels are savings and grocery clubs and burial societies. Two-thirds of grocery stokvels make bulk purchases once a year.
The Nedbank Stokvel account, launched last September, provides discounts of up to 10% on groceries and school supplies at retailers, with R551,000 worth of Shoprite vouchers having accrued to account holders.
Nedbank’s Stokvel account has 3,541 account holders, and has insured 88,900 lives through its burial cover.
“This initial success demonstrates informal savings groups like stokvels are ready to enter the formal financial system, provided they see the benefits of doing so,” said Sisa Cikido, head of retail investments at Nedbank.
According to African Response, 41% of stokvels were banked. Cikido said only 5% of stokvels were focused on investment savings.