Due to the economic crisis, more South Africans could turn to Stokvels in 2023

Stokvel-like systems are used worldwide.


The number of South Africans belonging to Stokvels is expected to increase amid market volatility in 2023, says Andrew Lukhele, chairman and founder of the National Stokvel Association of South Africa (Nasasa).

With membership at 11.4 million in 2022, the austerity scheme has been estimated at over R45 billion a year and is growing in popularity with South Africans. In 2022, about 810,000 stokvels were registered in Nasasa’s database.

Speaking to News24, Lukhele says austerity plans like Stokvels have historically been deployed when people were experiencing tough economic climates, including during wars and pandemics.

What are Stokvel?

“The term ‘Stokvel’ derives from the cattle auctions or cattle markets of English settlers in the Eastern Cape in the early 19th century,” explains Lukehele.

It is a financial system in which individual member clubs contribute money in the form of a lump sum each month. This lump sum can be paid to a member of the club on a weekly, bi-weekly, monthly or even yearly basis. Members can also receive a lump sum of their monthly dues at the end of each year.

“Stokvels, or savings clubs, have been around for generations, creating mini-communities where like-minded people can meet regularly to socialize and support each other to keep up with monthly dues,” says Sisandile Cikido, Head of Retail Investments down at bank.

Various types of stokvel are offered, including rotating club stokvel and food stokvel. It’s a phenomenon that exists worldwide, according to the NASA website. Similar financial systems are Tandas in South America, Kameti in Pakistan and Tanomoshiko in Japan.

financial pressure

After the financial pressures of the pandemic, many South Africans turned to Stokvels to save money. According to the Old Mutual Savings and Investment Monitor in 2022, informal savings and stokvel “remain popular and continue to attract significant inflows.”

The survey found that the average monthly contribution to Stokvels has increased from R1 213 in 2021 to R1 384 in 2022 – an increase of 14%.

“South Africans are notoriously poor savers, affecting the broader economy and families’ ability to weather difficult times [Covid-19] lockdowns, Stokvel has helped many people weather the catastrophic loss of income,” says Cikodo. These financial pressures could increase further in 2023 as many South Africans are currently experiencing financial hardship due to rising living costs and interest rates.

Advantages of Stokvel

As a financial system, Stokvels have many advantages that are attractive to South Africans, according to Lukhele.

“She is trustworthy, approachable and understanding of members’ needs and difficulties and can help in emergency situations when money is needed quickly because she is flexible and accommodating,” he says.

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