Stokvels, community-based savings schemes, have become more popular across all income segments. Customarily, they are invitation-only savings clubs where members contribute fixed sums of money to a central fund at designated intervals. They are governed by a formal or informal constitution that prescribes contributions, pay-outs, and member responsibilities. More and more people adopting the principles of community saving are doing so for purposes other than what was accepted as a norm some years ago (funerals, school fees etc.).
These savings schemes have mushroomed across the country as they provide members with access to investment vehicles, such as property and the Johannesburg Stock Exchange (JSE). However, most important in the current economic climate is their time-honoured ability to help members handle major family and financial needs.
So why would people who have some disposal income turn to stokvels?
Stokvels are a great way to force yourself to save, as you make a monthly monetary obligation to a group.
It’s hard to just withdraw from a stokvel when you know the members, reinforcing discipline.
Nominated chairpersons and treasurers ensure that the group’s constitution is adhered to.
Stokvels are also easy to set up, and banks now have special accounts for group savings schemes. If you want to set up a stokvel, or if you’re already part of one and want to formalise it, our Society Scheme account is ideal for any groups that save together. This option is safer, more convenient and you can also use digital banking to deposit and pay money to members.
Always remember to ensure that group schemes are safe and legal – if anything sounds too good to be true, it often is.