Across generations, stokvels have displayed the power to transform families. Whether it was through burials, education, house renovations, groceries, or generally covering financial obligations. Group savings have given South Africans the opportunity to meet their goals.
In recent times, stokvels have gotten even better. Today, instead of merely saving your money, you can stack your money while it grows. One of the platforms that helps you achieve that is Sum1 Investments.
In this article, we’ll be discussing how this platform works and whether it will be your next stokvel platform.
What Is the Community-based Investment Tool Sum1?
Sum1 Investments is a community-based investment tool that takes stokvels and transforms them into collective investments. This allows communal saving efforts like stokvels to not only benefit from saving over a period of time but to share returns on the growth of their investments.
Sum1 does not replace the stokvel structure. The stokvel still exists as a group with rules, leadership, contribution schedules, and agreed objectives. What changes is how the money is used over time.
This distinction matters because the communal aspect of stokvels is crucial. The assumption exists that stokvels are informal and risky. However, many operate with written constitutions, elected committees, and clear financial processes. Thus, an investment platform like Sum1 Investments can be a beneficial support system in addition to the stokvel culture.
Why More Stokvels Are Exploring Investment Options
Stokvel participation in South Africa remains high. According to Ipsos, there are around 800 000 stokvel groups and 11-million members. However, traditional savings-based stokvels face a limitation of minimal growth.
From a financial perspective, this exposes stokvels to the risk of inflation, where money loses value over time. On the other hand, they are losing the opportunity to grow their capital. Hence, stokvels are not turning to platforms like Sum1 Investments.
What many outside the stokvel ecosystem overlook is that stokvels already demonstrate strong financial discipline. Members commit to fixed contributions and honour obligations consistently. This behaviour is very similar to that of a short-term investor.
How Collective Investing Through Sum1 Investments Works
Sum1 Investments lets stokvels put their money together and use it to earn more instead of just keeping it in a bank. The idea is simple: members save like usual, but their money is invested in ways that can grow over time.
When a stokvel joins this community-based investment tool, each member contributes a set amount every month, with a minimum contribution of R500. All contributions are recorded digitally in a private dashboard on the Sum1 web app. This means every member can see how much has been saved, how much each person has added, and how the group’s money is performing. It replaces paper books or notes, making it easier to track money and avoid mistakes or disagreements.
Once the money is pooled, Sum1 uses it to invest in real projects in South Africa. This can include small businesses, farming projects, or local services. The profits from these investments go back to the group, so everyone shares in the growth.
At the end of the investment period, which is 13 months, members can either take their money and returns or choose to invest again for another term. This helps the stokvel plan for goals like school fees, home repairs, or starting a business.
Relevance for Small Business Owners
For SMEs, stokvel-based investing offers insights beyond personal finance. It demonstrates how collective capital can be mobilised and managed with discipline.
Many small businesses struggle with access to affordable funding, yet operate in communities where consistent savings already exist. While not all stokvels serve as a financial solution for businesses, some groups explicitly use investment growth to support entrepreneurial activity, asset acquisition, or property purchases. Also, Sum1 allows you to invest as an individual, even if you don’t have a stokvel.
This approach does not eliminate risk, but does serve as an alternative path to capital formation that does not rely solely on traditional lenders.
Invest and Fund Your Business
13 months might sound like a long time for an entrepreneur pressed for cash, but imagine what you could do if you set a goal for your business to achieve with a stokvel payout in the next 13 months. Perhaps you want to start a stokvel, but want to ensure your members trust you? Well, with an Authorised Financial Service Provider like Sum1 Investments, you can assure your members of the legitimacy of your stokvel.
Across generations, stokvels have displayed the power to transform families. Whether it was through burials, education, house renovations, groceries, or generally covering financial obligations. Group savings have given South Africans Read More
