WhatsApp stokvel ‘likely a pyramid scheme’

The new ‘WhatsApp stokvel’ doing the rounds on social media has been deemed ‘likely to be a pyramid scheme’ by the National Stokvel Association of South Africa (NSASA).

Messages have been sent to numerous social media users recently, encouraging them to invest R200 into a stokvel, in order to generate a profit of R800 to R1 000 (this amount depends on the specific group). This goes against the traditional basis of a stokvel, which is founded on trust.

Generally, all members of the stokvel would know one another but this latest WhatsApp phenomenon is conducted mostly anonymously and as such, it is almost impossible to trace the key members if and when the money disappears.

Hlengiwe Makhoba explained how she was recruited by a friend, who had earned R800 after joining the stokvel.

“There is a group I belong to on Facebook and members were posting about their earnings from the WhatsApp stokvel. Then a friend of mine told me how she made extra money from the stokvel; I was convinced and joined one via a WhatsApp link, which takes you directly to the group.”

Unfortunately, Hlengiwe soon found her ‘investment’ was a waste of money. She then withdrew from the scheme when she realised it had become ‘stagnant’. The cost – R200.

A student at a local college, Nonzwakazi Magubane, also wanted to join a WhatsApp stokvel and was given an account number and cellphone linked to the account holder. She had to make a deposit before being allowed to join the group.

“There were about 15 of us in this group and to my surprise, I was told I need to recruit people into joining the group so ‘the list can move’. I recruited a friend of mine. The group was moving quite quickly, as three or four people were getting paid a day, but as the group grew larger in numbers, the problems started. The administrator then split the group and once that happened, the new group went quiet, and I was then removed from it.”

Simpiwe Zwane, Assistant Director: Consumer Education at the Department of Economic Development, cautioned the public about investing in online schemes such as the WhatsApp stokvel.

“WhatsApp stokvels are similar to pyramid schemes, as only the first few people get paid and the rest lose their money. Such schemes involving payment of money are defined by the Consumer Rights Act and are unlawful.”

ALSO READ: All you need to know about stokvels before joining one

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