Strengthening informal social security to provide meaningful social protection: The case of stokvels in Soweto

Abstract

Informal social security, particularly Rotating Savings and Credit Associations (ROSCAs), popularly known as stokvels in South Africa, are widely used within the developing world, especially in sub-Saharan Africa due to the weak and/or non-existence of formal social security. These stokvels remain a major form of social protection for the poor, and their continued existence is a reflection of the absence of a comprehensive formal social security. The study explored the views of stokvel members on how stokvels, as a form of informal social security, can be strengthened to provide meaningful social protection. The study adopted a case study research design, located within a qualitative paradigm. The study population consisted of women members of stokvels with a minimum of five years in the stokvel. All participants were South African citizens residing in Johannesburg's Soweto Township, and were drawn from two different categories of stokvels, namely burial and accumulating savings and grocery stokvels. A key informant holding a strategic position in the National Stokvels Association of South Africa (NASASA) was recruited to be part of the study. Regulation and integration of stokvels with formal institutions, provision of financial support to stokvels through subsidies, and training of stokvel members on financial management skills emerged as part of strategies to be considered in order to strengthen the social protection provisioning of stokvels. It was clear that formalizing stokvels might be one of the possible  avenues that could be explored in order to strengthen their social protection  provision.

Key words: informal social security, social protection, strengthening, stokvels, Soweto, Johannesburg – South Africa