JOHANNESBURG, Gauteng — As South Africa observes National Savings Month this July, stokvels in South Africa continue to prove their enduring value, serving as a critical financial lifeline for millions of citizens. According to the National Stokvel Association of South Africa, the traditional savings model is not only surviving but actively gaining popularity, with an estimated 11 million people participating in these community-funded schemes across the country.
Busi Skenjana, founder of the Stokvel Academy, emphasizes that these communal savings vehicles remain highly relevant, particularly as consumers navigate the challenges of a rising cost of living.
“Stokvels have always been a shield in difficult times,” Skenjana explains, noting that the practice originated under historically challenging conditions. Despite modern economic pressures, she highlights that people still prioritize saving for their “worst days.” Members routinely allocate pooled funds toward essential needs, including food security, funeral and burial expenses, and general life upgrades.
Beyond traditional grocery and burial societies, a significant shift is underway in how these funds are utilized. Skenjana points to a growing trend of stokvels being leveraged for entrepreneurship. The younger generation is increasingly viewing these community funds as a strategic solution for wealth creation and a viable source of startup capital to launch small businesses. This dynamic allows members to bypass traditional barriers to entry in the business and property investment markets, transforming the stokvel from a mere safety net into a vehicle for economic empowerment.
However, the rapid evolution and growing popularity of the stokvel market have also attracted bad actors. Skenjana warns that scams remain a prevalent and serious issue within the space.
She advises potential participants to exercise extreme caution and thoroughly scrutinize the individuals behind any stokvel formation. “There are people behind the formation of a stokvel,” she cautions, urging the public to remain highly suspicious of any investment or savings scheme that appears too good to be true. By staying vigilant and verifying the leadership of these groups, South Africans can continue to safely harness the power of communal savings.
