Beginner's Guide to Starting a Stokvel NEW CI Main

Beginner’s Guide to Starting a Stokvel

Have you ever thought of joining a stokvel? This great South African tradition has become a source of both financial planning and a useful income boost for millions of people. But a successful stokvel rests on trust and security. If you’d like to start a stokvel with your friends, colleagues, or family members, read on to learn how. 

A stokvel is an informal group savings arrangement in which members agree to put away a predetermined sum of money each week or month. Contributions are typically made on a monthly basis, however the group is free to change the timetable as it deems fit. 

Some stokvels, like birthday fund stokvels, may spread out their payments to members over a longer period of time. Others may buy and distribute bulk groceries to their members during the Christmas and new year’s season. 

How the stokvel’s money is spent is a matter of consensus among its members. Members of some groups are given a portion of the group’s savings at the end of the year. 

Any number of things can be bought with the money, from a new house to school uniforms to a car, depending on the group’s priorities. The members of the stokvel decide everything that happens and why.

Here is our beginner’s guide to forming a stokvel for those who have always wanted to participate in this grand money saving tradition but didn’t know where to begin.

Choose your members 

The first thing to do is make a list of people you know and trust and who you think could be interested in participating. Set up a time to meet so that the stokvel regulations can be discussed. 

Participants from far away can join a stokvel through the innovative use of chat platforms and digital or mobile banking.  Building and maintaining trust is the most important feature of any stokvel.

Members of the same household, neighbourhood, workplace, or religious community have historically been the only people invited to a stokvel, but thanks to online chat groups, more people can now be invited to join and the stokvel can be invested in all sorts of projects. 

Set your rules in writing, and have these rules agreed to

It is essential that your stokvel have a written constitution. This ensures there will be concrete proof of the group’s agreement. A few important administrative roles need to be set up as well to ensure that the stokvel is run smoothly, and the rules are followed.

Conditions for membership, such as who can recruit, the scope of required background checks, procedures for a valid leadership change, etc., should be set out. 

There is usually a one-time enrolment charge for new members. The organization’s constitution should detail the contribution processes and amounts that it has determined to be reasonable.  

Typically, each member is free to set up a payment schedule that works best for them.

Establishing norms for member interaction and the extent to which members may pursue their personal interests at the expense of the group is crucial. 

It’s important to outline in the constitution the maximum number of excused absences and the repercussions for members who consistently miss meetings.

First things first: elect a chairperson, a secretary, and a treasurer for your brand new stokvel. All three of these leaders are held to the same high standards as the rest of the participants. 

The chairperson is responsible for establishing the agenda for each meeting, enforcing compliance with those regulations, exploring opportunities for growth, and authorising withdrawals with the secretary and treasurer.  

The secretary’s duties include keeping a register, taking minutes, and recording any other communications that occur within the stokvel in written form.

Find a way to keep the stokvel safe

Group checking accounts, or “stokvels,” are offered by several of the leading financial institutions in the country. Generally speaking, withdrawals from such accounts require the consent of all account signatories. 

As a result, there is less of a chance that any one person will be tempted to steal from or misuse the group’s money. 

Before choosing a bank, it’s wise to investigate all of the benefits that are available from a variety of banks.  Digital payment methods should be used by stokvel members whenever possible, but especially when receiving compensation, to reduce the risk of fraud.

There should be as few opportunities for fraud and financial mismanagement as possible when depositing and withdrawing the group’s funds.


With forethought and self-control, you can put your money to work for you throughout the entire stokvel process. Start a stokvel to save money towards shared goals and see your quality of living improve over time. 

Frequently Asked Questions

Simply described, a Stokvel is a sort of credit club in which a group of people agrees to contribute a fixed amount of money to a shared savings pool on a weekly, biweekly, or monthly basis, with members receiving a lump sum of saved money at the conclusion of an agreed-upon length of time.

To start, you should identify members who would be a good fit for your stokvel – most importantly, they must be people you trust. Next, agree on your stokvel’s rules. After that everyone should decide where and how the funds will be invested.

Your potential tax consequences are determined by how your stokvel functions. There will be no tax ramifications if you are a member of a simple stokvel in which you contribute a fixed amount of money each month and are paid out a lump sum once a year with no interest or growth on the amount donated.

Theft, fraud, and mismanagement are just a few of the threats that might jeopardise stokvel members’ financial security. That is why it is critical to adhere to best practises for stokvel security. Security breaches can have disastrous implications for stokvel members.

The National Stokvel Association of South Africa (NASASA), a self-regulatory group certified by the Prudential Authority, regulates stokvels.

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