Stokvels serve as savings vehicles for South Africans
Stokvels remain one of the most popular savings vehicles‚ together with funeral policies‚ for ordinary South Africans.
This is according to the latest Old Mutual Savings and Investment monitor‚ which found that 44% of the 1,000 respondents surveyed use their stokvel money to save for a rainy day‚ while 43% pay off debt.
The survey also revealed that 31% use the cash to purchase groceries at month-end‚ 31% to purchase furniture and appliances, and 25% to save for education.
"South Africans are very resourceful and resilient and to cope with rising monthly expenses‚ consumers from all income groups are beginning to purchase their groceries in bulk‚ while shopping for cheaper brands and looking for discounts‚" said Lynette Nicholson‚ Old Mutual’s research manager.
Economist Mike Schussler said stokvels "are a way for people who are in the lower-and middle-income groups to pool savings and it is often a cheaper way of doing it. The member then buys something they really need‚ say a fridge‚ which then also is brought for cash. They save on interest payments too."
Schussler believes stokvels enforce discipline and encourages a savings culture.
"If we look across the country‚ South Africans have many things‚ according to household surveys. We have lots of TVs (over 80%); cellphones (nearly 100%); fridges‚ stoves‚ furniture and so on," said Schussler.
"It also works well for people who do not have a fixed income and they give what they can when they can‚ but can not on occasion buy something."