BMP Properties, winner of the Management of Technology Award in the emerging enterprise category
Cash and paper are a thing of the past for this technology-wise stokvel
The stokvel industry in South Africa turns over R10 billion a year and almost all of this is paid in cash and recorded on paper, exposing stokvels and their members to all manner of risks. One that has broken the mould is Soweto-based Buhla Mahlo Properties (BMP), which has gone completely cashless and paperless.
“Yes, we are trailblazers in the use of technology in our industry, and introducing a cashless, paperless environment has solved a lot of problems for us,” says Archie Rantao, chairman of BMP Properties (which, as its name suggests, it more than a burial society – but more about that later).
Archie says the standard stokvel model is for members to pay their contributions in cash, often on a Sunday when the banks are closed. “The treasurer has to keep all that money until he can go to the bank on Monday, putting his life at risk.”
But safety is not the only challenge that cash transactions pose for stokvels.
“There also used to be a lot of conflict about members’ payments,” Archie says, explaining that proving who has paid how much and when is crucial for a stokvel.
“We are underwritten by a major insurer. If a member passes and their contributions are more than three months in arrears, the cover will not be paid. Before, members were always suspicious about the record keeping; now we can prove who paid and who didn’t, and there is no more conflict.”
Archie explains how this came about. “Cash puts your life at risk; you can lose it or be robbed. To mitigate the risk, we stopped accepting cash and asked members to deposit their contributions into the bank.
“We then downloaded the banking app to see who has paid and created a computerised spreadsheet to record the transactions. Once a month, the spreadsheet is circulated to all members on WhatsApp for everyone to see.”
Initially, there was some resistance to the new way of doing things. “In the townships, cash is still king,” Archie says. “It took some time to convert our members to cashless and paperless processes, but people see the benefit. It’s more transparent. Trust is key in everything we do in life. Without trust, there is no institution.”
Other benefits are greater efficiency and better client service. “Using technology, you can track and reconcile your earnings and you always know how many clients you have,” he says. “And why put your life at risk or expose people to temptation by working with cash?”
Having successfully introduced cashless, paperless business, BMP Properties is also expanding its scope of activities. It has purchased a stand at Protea Glen in Soweto and is seeking corporate partners either to establish a private school or build student accommodation.
“We decided we wanted to be more than a burial society and also contribute to access to quality education in the townships so that our kids don’t need to travel to the suburbs,” Archie says. “Kids have to wake up as early as 4.30am to get transport and they come home at 6.30pm or 7pm, tired. It’s too much for them. We want to bring services to the townships so that our kids can have a better life.”