A joyful graduation

Reflections on the Table Mountain graduation, 12 May, 2011

Anton Krone, Executive Director, SaveAct

Today is a special day, a day of celebration of the resourcefulness of ordinary people who live outside of mainstream economic opportunities.

Women and a few men in Maqonqo have grasped opportunities offered to them to be trained in a unique savings methodology originating from NGO work in Africa. Through their participation they report experiencing a sense of empowerment, a sense of agency over their lives. In this area of Table Mountain and Maqongqo there are already well over 1 000 women and 163 men, including young men who have joined savings groups. And they all sing a common tune, that they have been able to assume control over their household budgets, that they have been able find funds for school fees, and have begun to shed dependence on loans sharks.


Graduands at the SaveAct graduation ceremony listen to the keynote address
by Finance MEC Ina Cronje

Members of savings groups experience profound changes in their lives. They develop their self-esteem and work together to help each other cope with challenges and adversity. And this they do, after initial training and mentorship, entirely on their own. This is what we celebrate today: the moment at which 10 savings groups achieve their independence from that support process, the moment at which they graduate as well-functioning savings groups capable of sustaining their activities into the future. There are few development or service delivery interventions that can culminate in such an outcome. It is something to celebrate, pause over; and to contemplate the opportunities for ordinary people if such work was to be scaled up around the country. Not just thousands, but hundreds of thousands more people, could benefit from this kind of programme given the right conditions to enable it to spread.

SaveAct staff and village promoters are to be congratulated for their hard work in training 65 groups in this community. Further afield in KwaZulu-Natal there are now 250 groups totalling more than 5 000 members. SaveAct welcomes this event as an opportunity to share this experience with others in the province. It comes at a time when SaveAct is gearing towards scaling up this programme in KwaZulu-Natal and the Eastern Cape. SaveAct is convinced that this programme provides important answers to the challenge of how to enable the rural poor, especially women, to assume control of their lives and initiate, on the back of their savings platform, the kinds of self-employment strategies that national government seeks to secure. The signs are there and the potential is enormous.

Finance MEC Ina Cronje visited a spaza shop
run by Table Mountain resident Ms Sizani Ngubane
(also pictured at top). Since becoming a member
of a SaveAct-promoted savings and credit group
in 2009, Ms Ngubane has been able to borrow money
to increase her stock and improve the shop’s storage
facilities and capacity.

At the same time, SaveAct does not wish to portray this programme as the solution to rural poverty. Many other important support systems and strategies are needed to tackle this complex and challenging issue. Government and the private sector have important roles to fulfil in complementing programmes such as this one. Government and the private sector need to work with NGOs to tackle the poverty and extreme inequalities that plague our country. This situation threatens our stability and future as a young, inclusive nation. If we are to succeed in integrating our society, building an inclusive economy and eradicating the social ills, we have to work together at many levels: in villages, at local and district level, across our provinces and up to the level of national policies. We have to recognise amongst ourselves our respective strengths and work in ways that complement each other.

We welcome the initiative of the KZN Treasury to launch a financial literacy association embracing major stakeholders. It is recognition of the importance of developing ways of working together. This initiative brings hope and opportunity. There is much work still needed to make it succeed. We need an honest and respectful dialogue for a partnership to develop and flourish. We need to be practical and realistic about what we can do. We need (just like the economy) a predictable and supportive environment within which to innovate and build, bit by bit, effective programmes that make a difference amongst women and other vulnerable groups.

SaveAct wishes to thank its board members for their commitment to the vision of a better society, to their willingness to give freely of their time. This is deeply appreciated. Without the foreign donor partners that played such an important role in enabling us to fight apartheid and who have stayed with us to enable us to find innovative strategies to fight poverty and exclusion, this work would not have been possible. Our thanks thus go to the Ford Foundation for the founding grant, and five years of support. To the many other donors, Misereor from Germany, Vesper Society from the US, the Embassy of Finland, the European Union, the NDA, Hanef Bhamjee, and some of the more recent programmes emanating from provincial and national government, we give our thanks. Please stay with the journey of building a better country.

Anton Krone, Executive Director, SaveAct


What is the SaveAct savings and credit model? The savings model involves small groups of eight to 25 members per group who meet on a regular basis to save, lend to each other, and build up a social fund for household emergencies such as bereavement. They adopt a constitution, elect office bearers, save in shares, award loans and record all their transactions as a group. Surplus funds are stored with a secure system that has seen their funds well cared for. The groups decide the interest rate at which they lend and they distribute the shares plus interest annually, according to the number of shares bought. The more you save the more money you are rewarded with at the end of the cycle. It is a simple system that people understand as it is not unlike the stokvels that prevail in South Africa. There are, however, key differences. The groups are grounded in trust. The systems ensure transparency of transactions and the records provide a clear account of fund management. This means that people are not taken advantage of, a common failing in many stokvels or burial societies. Financial education  and access to micro-business training are provided to members of savings groups. Repayment rates on loans amongst these savings groups exceed 99%. The drop-out rate from savings groups is only 1%, including deaths. Annual rates of return on savings range from 20 to 100% and typically averaging over 30%. Members are rewarded with a large lump sum at their share out. This motivates and inspires others to form a savings group.




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