More than 11.4 million people in South Africa collectively save about R49 billion a year through stokvels, and this number is set to increase as factors such as the weak rand, high inflation, increasing food and electricity costs put pressure on consumers’ budgets, making it difficult to save.
Pick n Pay announced a new partnership with the National Stokvel Association of South Africa (Nasasa) to develop grocery offerings for its members.
According to the association, which has worked with stokvels since 1988, there are more than 800 000 stokvel groups in South Africa. An estimated 40 percent of South African households belong to stokvel group-saving schemes.
The association said there are more than 11.4 million people in South Africa who belong to a stokvel, collectively saving about R49bn a year.
Papi Rapolai, Pick n Pay’s head of Wholesale and Stokvels, said the retailer has developed a special relationship for stokvels through its Hypers which offer a wide range of value-for-money goods.
“We are customising Pick n Pay’s Smart Shopper programme, which has close on 10 million members, for the stokvel market.”
Its Smart Shopper programme will include special discounts and vouchers for its stokvel customers.
They will get 1 percent paid back in Smart Shopper points that can be converted into cash to pay for their groceries.
Members can also earn instant savings on certain products during specific periods of the year, such as Easter and Christmas.
Rapolai said the new stokvel loyalty programme helps the retailer deliver a better offering informed by members’ shopping behaviour.
Andile Mazwai, Nasasa’s chief executive, said the partnership between the association and Pick n Pay means that stokvel members are able to access quality products at the best prices.
“This will save our members a tremendous amount of time and effort spent shopping around for specials. Not only that, but the partnership has created a rebate system that will give back to participating groups.”
Mazwai said the association is seeing an increasing number of people forming groups for the purpose of “contractual saving”.
“We are also seeing new types of groups being formed, such as Debt Rescue Stokvels. We are also seeing a rise in Investment Stokvels, or existing groups turning themselves into investments groups. This shows that people are coming together to weather this storm.”
Mazwai said this year is going to be a difficult economic year for South Africans.
“In our Q1 Sonke Magazine we advise groups on how to save by cutting out bad debt and investing. Stokvels are a brilliant way to save because each person enjoys the support of the group in order to achieve their financial goals.”
Jo-Ann du Plessis, the head of pricing and products at FNB, said stokvels are uniquely South African and are powerful as saving with a group encourages good saving behaviour.
“Saving with a group creates positive pressure to keep up with contributions which is why many South Africans choose to use stokvels as a way of saving. Stokvels can be used as a way for funding groceries, burials, weddings, school fees and holidays.”
Du Plessis said the stokvel is governed by its members who decide on a goal, and the rules for the savings and amounts contributed can vary from a few rands to thousands paid either weekly, fortnightly or monthly.
“There are many reasons why stokvels are such a successful way of saving.
“One major reason is accountability. The fact that you are a member of a group that has a common goal and defined contributions makes it very hard to shirk on your savings responsibilities, which people are tempted to when saving individually.”
Du Plessis said FNB’s Stokvel bank account is aimed specifically for saving as a group.
“We find that the majority of stokvel accounts are opened at the beginning of the year, as people start to save early in the year for the festive season or for unexpected events in the year.”