Money is on our minds every day, whether we’re spending it, earning it or trying to save it.

Saving, in particular, takes discipline, planning, consistency and patience over time. But for millions of South Africans, it’s not something you have to face alone. Sharing the experience usually means joining a stokvel, which is a communal savings group. This informal saving ‘product’ has become synonymous with community, confidence and independence. 

With July marking national savings month, there’s no better time to reflect on the rich journey of stokvels: where they started, where they’re going and why they offer far more than financial benefits to members and communities. An informal and truly flexible saving product that works for people from all walks of life.

Spotlight

Stokvel comes from the word ‘stock fair’, introduced by British settlers in the Eastern Cape during the late 1800s. These fairs were rotational cattle auctions where participants pooled resources to buy livestock, often making ownership possible for people who couldn’t afford it alone. However, similar communal saving practices likely existed long before in other African contexts and beyond.  

Although stokvels, also known as group savings schemes (and various other names across the world), have been around for generations, it has evolved significantly over time. Now stokvels come in many forms. These are some of the most common types, according to the National Stokvel Association of South Africa:

Over 11-million people in South Africa, the majority of whom are women, make use of stokvels, according to NASASA. It is estimated that there are more than 800,000 groups which circulate over R50-billion annually.

While stokvels were only formally recognised and structured in South Africa during the 1980s, they have grown into much more than saving clubs. Stokvels offer a strong social support system, not only during financial hardship, but also in times of loss or family emergencies. Members play an important role in holding one another accountable but they also can offer reassurance and reduce stress through the comfort of not facing challenges alone. 

It also includes in-app messaging and financial literacy tools to support learning and communication among group members.

Storytelling

There are many stories that show how collective effort can benefit an entire community, and this version of the European folk tale ‘Stone Soup’ is a perfect example. 

As the soup simmers, the travellers suggest it would taste even better with just one more ingredient, like an onion or a few carrots. One by one, villagers begin adding what they have. Before long, the pot is filled with rich, hearty soup made from everyone’s small contributions. That evening, the travellers and villagers sit down together and share the nourishing meal they all helped create.

Stokvels are rooted in the same principle as the Stone Soup story: when everyone contributes a little, the whole group benefits. Across the country, thousands of stokvels operate like that shared soup pot, turning small individual contributions into something meaningful for the whole community.

Links we love

Reading material

This Daily Maverick article details SaveAct’s (mentioned above) impact on the agricultural community. It also highlights a specific story of NoWinile Lungiswa Mangquzana, a smallholder farmer raising chickens and growing organic produce in the Eastern Cape and how she saved for a solar-powered irrigation system and grew her business.

Busi Skenjana’s book ‘Stokvel Voices: The Truth, The Illusions & The Opportunities’ explores the origins of stokvels in the country and how people, especially women, have used this system to achieve financial security and independence.

Podcasts

Moneyweb speaks to Sifiso Nkosi, stokvels and group savings head at FNB Cash Investments, about all the different kinds of stokvels and how the system has changed and grown over the years.

Inspired? Here are some tools to start your own…

This Nedbank guide details the ins and outs of stokvels, from all the different kinds of savings groups out there to how you can protect yourself from stokvel scams.

The Stokvel Academy has built a strong reputation as a go-to resource for learning about savings groups. In a video on their YouTube channel, founder Busi Skenjana guides viewers through the steps of starting their own stokvels. The Academy’s website also features beginner-friendly courses on stokvels.