Stokvels have come a long way since the early 1800s when
English settlers in the Eastern Cape held rotating cattle auctions and locals pooled their resources to trade livestock.
They now consist of a group of members, who pool their financial resources towards a common goal, and banks have come on board.
According to African Response, 41 percent of stokvels are banked,
which has brought more South Africans into the formal financial services sector by giving them access to other savings, investment and protection offerings.
“Today stokvels are seen as key savings vehicles that can significantly enhance discretionary savings levels to bolster the economy,”
SA banks on stokvels said Sisandile Cikido, the Head of Retail Investments at Nedbank.
“With over 11 million South Africans being members of stokvels, R44 billion is collectively saved in 820 000 stokvels in South Africa annually,” she added.
Stokvel market grows According to the National Stokvel Association of South Africa (NASASA),
the stokvel market has grown so much that it’s now worth more than some of South Africa’s largest businesses.
The country’s top stokvel savers live in Gauteng,
Limpopo, the North West and KwaZulu-Natal, and account for 70 percent of stokvels in the country.
“The most popular types are savings stokvels, burial societies and grocery stokvels,” said Cikido.
According to Thamsanqa Cele, Head: Deposits,
Everyday Banking and Retail and Business Banking SA at the Absa Group,
stokvels have become an exchange of various goods, cash, investment returns and experiences, like collective travelling and book clubs.
“They continue to evolve from being consumption based to generational wealth creators,” he said. Today’s variety of stokvels serve various purposes.
Cele explained that the country’s development has made SA banks on stokvels
South Africans more ambitious when it comes to attaining goods and services that have generally been exclusive, including sharing travel experiences;
book clubs to invest in knowledge, wisdom and taking advantage of the power of many;
investing in property and equities; and taking advantage of black economic empowerment investment schemes.
“However, the mainstay of many remains the ability to bargain through bulk buying and sharing, saving together for redistribution to educate children
and to act as informal insurance against events like burials, weddings and other similar heavy cash flow activities,” Cele said.
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