The motivation and success factors of Zimbabwean grocery stokvels in Cape Town, South Africa

Abstract

Owing to socioeconomic and political turmoil in Zimbabwe, large numbers of Zimbabweans emigrated to South Africa. As many are effectively excluded from availing themselves of the services of financial institutions in the formal sector, they often form stokvels, an informal method of saving which is commonly practised in their home country. The research study was conducted in order the investigate the dynamics of Zimbabwean grocery stokvels in Cape Town, the factors which have encouraged their formation and contributed to their success, and those which could potentially militate against their success. A mixed methods approach was adopted and both quantitative and qualitative research methods were used to collect the data. The quantitative data was obtained through the administration of a survey questionnaire, while the qualitative data was obtained by conducting one-on-one semi-structured interviews with leaders of Zimbabwean grocery stokvels, their spouses, and members of their families who did not belong to their stokvels. The qualitative data was augmented through the taking of field notes during the interviews. The findings revealed that grocery stokvels serve two related purposes. They enable their members to save towards making large collective bulk purchases at advantageous prices and also to send scarce and highly prized basic necessities to their families and relatives in Zimbabwe, who continue to suffer extreme privations owing to the meltdown which the economy of the country has undergone. The success of grocery stokvels stems largely from the close ties, which exist among their members. It was found that although women tend to dominate grocery stokvels, in some instances male members participate by providing financial support. The chief factors which emerged as having the potential to militate against the success of grocery stokvels were members leaving owing to unforeseen adverse financial circumstances and the erosion of mutual trust owing to members failing to honour their obligations to make fixed monthly contributions. The recommendations which were made on the basis of the findings included the drawing up of formal constitutions and stokvels entering into agreements with large wholesalers and retail chains to maximise the benefits which grocery stokvels are able to derive from collective bulk purchases. It was also suggested that males should participate more actively than they do at present, as making fixed monthly contributions entitles them to participate in decisions concerning how the funds which have been accumulated should be spent at the end of each cycle.