The role of stokvels in South Africa: a case of economic transformation of a municipality

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Stokvel is a type of ‘rotating savings and credit associations’ found only in South Africa (SA) which have an estimated value of R49 billion and a membership of 11,5 million, in a country with a populace of 57million and an informal economy with a total value of R160 billion – yet remain a hidden sector of the economy. This confirms that there is a shortage of the consulted literature on the model for integrating the stokvels into the economic policy framework of a municipality. Therefore, developing the stokvel industry could be key to poverty alleviation, reduction of unemployment and broadening equitable access to the ownership of the economy and capital accumulation; thus, improving the livelihoods and raising the standard of living. The objective of the paper is to determine the economic contribution factors of stokvels in the economic transformation of SA at a municipality level. The paper used a mixed methods design. A sample size of 395 stokvel groups’ respondents for the quantitative research was selected using a simple random probability sampling method. The response rate was 100 percent. For the qualitative part, six policy-makers were interviewed using the purposive non-probability sampling method. The paper revealed that the money saving and investment, business opportunities and job creation, and policy development were the main economic contribution factors of stokvels in SA at the municipalities. The paper recommended for policy-makers to formulate an economic transformation policy framework inclusive of stokvels and to adopt their economic contribution factors.

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    • Table 1. Response on affiliation of stokvels to NASASA
    • Table 2. Response on monthly contributions per stokvel member
    • Table 3. Responses on municipality developing a policy framework
    • Table 4. Response on the municipality transforming the economy through stokvels
    • Table 5. Response on types of stokvel groups
    • Table 6. Response on primary objectives of stokvels
    • Table 7. Response on educational level of stokvel participants
    • Table 8. Responses on how stokvels contribute to the economy
    • Table 9. Response on gender representation in stokvels