The more I grow up the more I realize that there was a great deal of wisdom in some of the things that my parents did and participated in. One of these is the practice of creating Stokvels, which used as financial vehicles in order to grow their money such that they could pay our school fees, feed us and furnish our homes. Now young fintech entrepreneur named Tshepo Moloi brings us StokFella, a company that makes the use of Stokvels easier and more relevant to the modern day youth.
Tell us a bit about yourself and about StokFella in terms of what it does?
I was born and raised in Soweto, went on to study Engineering and am now in the process of completing a finance degree. I have working experience in mining consulting and banking. StokFella is a solution developed with the intention of removing the administration burden present within stokvels thus allowing them to focus on their main objectives.
So how did the idea to create it came about?
As with any other great idea, StokFella was born out of a question: “There must be a better way to do what we are doing?” I found that in the stokvels I was part of and those we observed, frustration about activities which required tedious administration were hindering stokvels from realizing their the true value.
Young fintech entrepreneur named Tshepo Moloi brings us StokFella, a company that makes the use of Stokvels easier and more relevant to the modern day youth.
We focus on stokvels because they have been a financial instrument in our communities since the 19th century and we believe that by focusing this instrument efficiently, it will allow ordinary citizens the opportunity to pursue and realize financial freedom.
Would you say Stokvels are still relevant for millennials in saving and investing?
Stokvels are as relevant today as they where a century ago. In fact, in a paper done by Africa Response in 2012 titled ‘Stokvels Hidden Economy’, the average age of stokvel members is 25 – 49, proving that stokvels are not for old folks as many people think. We also find that in our engagement with young black professionals, they tend to use stokvels to gain access to investments quicker. Furthermore, Old Mutual Savings and Investor Monitor July 2015 found an increase in stokvel contribution from 2014 to 2015 showing that stokvels remain the dominant source of saving culture amongst the majority.
How is your app changing the game?
The app changes the game in the field of savings for the youth by now bringing the culture of stokvels into their daily techno savvy life. We believe that just as the youth uses social media with a click of a finger, they will do the same when making a collective financial decision on the StokFella App.
Do all the members of the Stokvel have to have the app?
No, although ideally if all the members have the app its full value and potential would be immense. However we understand that smartphone penetration in SA is only 49% hence not every stokvel member would have the capability to download the app. Therefore to accommodate this member, we have allowed other members who’ve downloaded the app to capture on behalf of this member so that they are not left out of the ecosystem. One day when the member gets a compatible phone, we will auto populate their history when they download the app and link to their group.
I see that one can track outstanding amounts from different members of the Stokvel, but how is the payment verified?
Great question, payments are entered by members and varied by the administrators of the stokvel (Chairman and Treasurer) same as they would do in a written ledger book. We then apply financial modelling to track and generate outstanding payments as well as other outcomes such as financial performance of the group. We are not linked to a central bank account at the moment because we realize that trust is the main virtue upon which the culture of any stokvel is established. Accordingly, we first wish to be trusted by stokvels, that we can manage their administration headaches accurately before we move into actual money verification.
Can a stokvel link an investment account to the app in order to unanimously see growth?
This functionality has been requested by some groups on our platform and we are looking into it. However it is important to understand that before you link anything which will lead to a complicated solution, stokvels must first understand their own potential. We find that when we ask an average member the following questions: how much is in your stokvel’s bank account? who is behind with payments and why? they tend not to know. It is therefore essential in a stokvel that members understand and can accurately monitor and manage the movement of their money before it even reaches an investment account.
What will happen in the event that I have the app but cease to pay for the service?
Imagine a stokvel running for 2 years then suddenly the ledger book within which they keep all their records went missing? There is so much risk in not keeping your stokvels financial activities electronically. We eliminate this risk through the use of the app hence your information is safely secured. If you decide to stop using the solution for a short period and return later, you will still find your info intact. The only time the info is deleted is when you delete your group as the Chairman on the app.
What is the best advice with regards to money and investments that you have received, and what is the best advice that you can give?
Best advice I got, do not spend money you don’t have, period! Best advice I can give, time is the most precious commodity you have. The sooner you realize this, the sooner you will make compound interest your best friend.
Where can we get the app?
The App is available for Android 4.4 capable phones and on iOS 7 iPhone and iPad. Alternatively, visit our website at www.stokfella.com for further info. Follow us on social media @StokFellaSA for the latest news on cool new features that we are currently working on.