Cash-smart South Africans are buying bulk groceries to stretch their rands

Stokvel savers are pinching every rand by saving to buy grocery items at bulk discounts, according to research released on Monday.

Data from research conducted by Nedbank indicated that the most popular types of these informal financial groups are savings stokvels, grocery stokvels and burial societies.

Two-thirds of grocery stokvels make bulk purchases from various retailers and wholesalers once a year, over the last four months of the year.

In total there are more than 11-million members of SA stokvels, with a total of R44bn collectively saved annually in 820,000 stokvels.

The country's top savers live in Gauteng, followed closely by Limpopo. Together with North West and KwaZulu-Natal, these four provinces account for 70% of SA's stokvels.

Nearly six out of ten (57%) of stokvel members are women.

"If harnessed correctly, stokvels could be the driver that South Africa needs to significantly enhance discretionary savings levels to bolster the economy," Nedbank says.

Sisa Cikido, head of retail investments at Nedbank, said only 5% of stokvels are focused on investment savings. This reflects the fact that SA has the lowest savings rate among G20 countries. Of those that do save, 40% have their money invested in low- or no-interest accounts. To help the country and its citizens achieve their economic goals, a smarter savings culture driven by accessible products in the formal sector has to be built, she said.

"Making the banking system truly inclusive does not only benefit individuals, but also strengthens the economy as a whole."