A new app has been launched to encourage stokvel members to save by investing in the money market.
Billed as South Africa’s lowest cost investment platform‚ the smartphone app‚ known as Franc‚ was launched by Thomas Brennan‚ the former head of digital innovation at Discovery Health.
Franc will allow stokvel members to invest in money market and exchange-traded funds (ETF) for R5 a month‚ the company said in a statement on Wednesday.
Like stocks‚ ETFs are listed on the JSE‚ but track an index‚ such as the Top 40‚ a commodity‚ bonds or a basket of assets.
Access to Franc is free for the first six months and there is no minimum investment amount.
“You can withdraw or transfer your money any time without penalty and there are no hidden or complicated fees‚” the statement said.
Franc‚ a member of Rand Merchant Investment Holdings’ financial technology investment arm‚ launches at a feverish time for fintech companies‚ a number of which are seeking to lower costs and improve access to financial services and products.
“South Africa has one of the lowest savings rates in the world. For the vast majority of South Africans‚ accessing investment opportunities is expensive and difficult‚” said Brennan.
“This is something that we want to change with Franc‚ which is now the most affordable way to access the money market and exchange traded funds.”
Franc’s two investment options are the Allan Gray money market fund and Satrix 40‚ which tracks the performance of the 40 largest companies listed on the JSE.
“Stokvel members simply choose how much they would like to invest‚ how often and how they would like to split their investment. They can choose between the lower-risk Allan Gray money market fund or the higher-risk Satrix 40 ETF‚ or a combination of the two‚” said Brennan.
As Franc functions like a stokvel‚ users must be invited to join. By signing up to the app‚ Franc will match you with someone you know.
Hanna Ziady – TimesLIVE