Why do stockvels persist alongside a sophisticated formal financial sector in South Africa

Initial impressions from the Social Protection and Local Economic Development (LED): Graduation Pilot Project


In his 2013 Budget Speech, Minister of Finance Pravin Ghordhan stressed the importance of inculcating a savings culture amongst South Africans. The low levels of savings among South Africans have led the National Treasury to institute extensive reforms to the retirement funds, effective 1 March 2015. The National Treasury (2013) argues that this reform is aimed at helping ‘vulnerable people such as farm or domestic workers who don’t have pension savings. The intention is to create compulsory savings vehicle for their retirement, thereby reducing the burden on the government over time in terms of social grants’ (National Treasury, 2013).