Stokvel-friendly accounts – which one is fair?

By Athenkosi Sawutana

The stokvel economy is approximately worth R49 billion in South Africa. This is according to the National Stokvel Association of South Africa (Nasasa). Altogether 24% of these stokvels are in Gauteng, while only 6% are in the Western Cape.

Stokvels are a way to save and raise money for groceries, funerals, and even purchasing properties.

Back in the day, this money was hidden under the mattress or placed into one of the members’ personal bank accounts, blocking access by other members. This was until the 1980s when Nedbank, in association with Nasasa, opened the first bank account for stokvels.  Since then, other banks have also jumped onto the bandwagon, competing for better services and prices. 

Tip: If you’re interested in comparing other bank accounts, go make use of our banking comparison tools for savings accounts, current accounts, and credit accounts.

Justmoney compared the stokvel accounts from different banks to help you and your stokvel mates make a better choice. Have a look at the below table:

 

 

Nedbank

Standard Bank

Absa

Minimum deposit

R100

R 100

R50

Interest

The higher your balance, the more interest you earn.

From 1.75% up to 3.6%

From 1.4% up to 4.8%, depending on the amount available. No interest balance below R50.

Monthly fees

R0

No account fee if the balance is above R5,000.

R0

Documents

A valid South African identity card/document or permanent resident permit for each signing member.

A copy of your stokvel’s constitution.

A copy of the minutes of the meeting in which the decision was made to open the account.

 

You will need IDs and proof of residence of at least five group members, and three authorised signatories to open an account.

The IDs of three elected group members who will act as signatories.

Proof of residence of three members.

 

 

Other benefits

R10,000 burial cover for each member of your stokvel for only R20 per member per month.

Automatic entry into a monthly saver’s draw competition.

R2,000 accidental death cover.

 

How do you start a stokvel?

Stokvel groups are constituted outside of the banks. The individual member contributions are determined by what people can afford, says Angela Karnien, spokesperson for Standard Bank.

Once the stokvel constitution has been formed and members have agreed on their monthly contribution, a commitment is determined to contribute without fail, which is normally a clause defined in the group constitution. 

You must select party members, such as a secretary, treasurer and chairman. But most importantly, you must select authorised signatories empowered to represent your stokvel regarding regulatory and legal matters.

The signatories will be legally mandated by members to open a bank account, withdraw funds, and play other significant roles with regards to the management of the group, says Karnien.

 Why should you be part of a stokvel?

According Karnien this is how stokvels are beneficial to you:

  • Stokvels are a great way to avoid temptation and force yourself to save as you make a monthly monetary obligation to a group that must be fulfilled.
  • It’s hard to withdraw from a stokvel when all the members are your friends.
  • Stokvels are easy to set up and banks have special accounts for groups.
  • Members nominate chairpersons and treasurers from within the membership. Members know that the people looking after their hard-earned cash can be trusted.
  • Everybody is working towards a common objective, which is safeguarded by a stokvel's constitution.

There is no doubt that many of the new stokvels being registered are used to help members handle major family and financial needs. These include pocket-draining projects, such as paying school and university fees, says Karnien.

This is why you need to choose a service provider that will not only offer you great prices, but also great additional benefits.

If you’re looking for alternative ways to invest your money, consider taking out a unit trust or opening a retirement fund to see you through your golden years.

 

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