Abstract
The apartheid system, which was used to govern South Africa, saw many black South Africans being excluded from participating in mainstream economic activities. As such, they resorted to unconventional and ingenious means to save, invest, and access credit. During this period, many were forced to relocate from their rural homes to work in the cities. This displacement necessitated that people who did not necessarily know each other before, but due to similarities and shared values, pooled their resources together to achieve common goals. This is how self-help financial associations, known as stokvels in South Africa were formed. This mechanism was made popular by its members who hosted regular meetings to discuss stokvel-related topics, and later became a space to socialise and network with like-minded people. Despite the informal nature of stokvels, they remain popular with over 11 million active participants, and they are playing a significant role in improving the lives of black South Africans. As of 2021, this 50 Billion Rands industry informally known as “South Africa’s hidden economy” continued to thrive despite the COVID-19 pandemic, which saw many industries collapse. One of the significant contributors to stokvel success is the consistent and transparent communication that is embedded in the stokvel culture. It is therefore essential that a strategic communication approach is deployed to keep stokvel stakeholders engaged.
This research study therefore sought to understand how indigenous financial associations such as stokvels use social media to communicate with their stakeholders. Furthermore, the research study wanted to explore how stokvels integrate social media into their stakeholder engagement strategies to build, nurture, and sustain relations. A literature review was undertaken for this qualitative study to shed light on stokvels and social media as a strategic communication tool. Stakeholder Engagement, Social Capital, and Social Media Engagement Theories were adopted as theoretical grounding. Semi-structured interviews were conducted with the representatives of six South African stokvels that use social media to engage their stakeholders.