Stokvels: huge economy ‘hidden’ under a mattress


Saving money through stokvels is still considered as an activity associated with the township ‘unsophisticated’ types, the lower end of the financial chain. But the mainstream financial sector should not overlook this ‘hidden’ economy, Mamapudi Nkgadima, Africa Response Managing Director, remarked at a stokvel round table.

Nkgadima highlighted: “This is huge, whether money kept in a bank or under a mattress. This is money being contributed for different purposes and money is circulating.”

According to statistics from a 2014 survey by African Response, stokvels have over 8.5 million members whose savings are estimated at R25 billion. Nkgadima does not rule out the fact that the number could be higher, given that one person could be a member of three stokvels.

Sadly, the mainstream banking institutions have not warmed up to the stokvel phenomenon as convincingly as most would have expected. They have not introduced incentives to attract stokvel deposits. Small wonder, they cannot access billions that are piling under mattresses.

But while banks dither to take advantage, stokvels continue to grow. “Stokvels are not going to die anytime soon, but they are definitely evolving, changing and becoming wiser, but they are not going to die anytime soon,” said. Nkgadima.

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