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South African tech startup, United African Stokvel (UASV) has created a community-based stokvel that aims to digitise the process of informally saving money in order to assist users in managing their finances.
A digital stokvel encourages South Africans to save for their future
A stokvel is a savings or investment society where members are invited to contribute a fixed sum of money to a central fund and receive a lump sum payout at a specific time of the year.
Founded in March 2019, UASV uses a trust account to store members’ savings which is managed by Darren Langbein, Chairman of United African Stokvel. This startup makes use of a savings cycle to generate rewards for members.
How it works
Once UASV collects it’s members’ savings contributions, the tech startup starts a savings cycle. The money is invested in property and the telecommunications sector, for an agreed-upon time frame, where investments will reportedly grow at a rate of 1.67% each month.
After the cycle is complete and members have invested for an agreed period, known as a lock-in term, they receive their initial savings amount with rewards. The member is given a choice to save again and start a new cycle or use their savings for something else.
UASV, self-funded by Chairman, Darren Langbein, not only provides a service where locals can save money and earn interest but also aims to educate locals on the benefits of being financially savvy.
Members of UASV are provided with educational tips on how to save money via their informational money tips blog.
This community-based stokvel is reliant on trusted individuals and claims to have over 2 000 active saving members.
Funds will only be accessible when a member has completed their lock-in term, however, members can decide to cancel their plan, providing members with control over their funds.
The digital stokvel recently announced on Facebook that they have achieved incredible results thanks to the influx of members.
“We have reached a huge milestone! With so many people joining our digital stokvel we are proud to announce that our first biggest milestone has been reached. To date, we have paid out R700 000 in rewards to customers saving with us.”
Featured image: Pixabay via Pexels