Are Women the key to unlocking South Africa’s Economic Growth

ARE WOMEN THE KEY TO UNLOCKING SOUTH AFRICA’S ECONOMIC GROWTH?

Every August, South Africa celebrates Women’s Month to honour the historic 1956 Black Sash Women’s March, when more than 20,000 women of all races and backgrounds marched to the Union Buildings in Pretoria to protest against the extension of apartheid pass laws to women. But beyond commemorations and campaigns lies a deeper truth: women are potentially the key to unlocking our country’s full economic potential. Their creativity, resilience, and leadership are not just social assets – they’re strategic imperatives for growth. In this month’s Financial View, we state that women are critical to assisting South Africa emerge from our economic slump.

As we stand at the threshold of economic reinvention, we must ask: what happens when women aren’t just included, but empowered to lead?  They often say that “the hand that rocks the cradle rules the world”.

Women as Economic Architects

Women often operate as an invisible infrastructure in the form of running households, caregiving, cooking, budgeting, and community support, all of which form the economic backbone.

These roles are traditionally undervalued in GDP calculations, despite their enormous impact.  This is especially true when we consider the informal economy and cooperative models.  

In the informal sector we see that women are driving micro-enterprise due to limited opportunities in the formal sector.  There are numerous examples of ventures like small-scale agriculture, textile work and in the food industry.  These business ventures uplift families and ripple through communities. 

There is a real economic multiplier effect where one introduces additional income into a family and a community.

Let’s say a woman in a rural village starts selling handmade textiles:

– She earns income.

– She uses it to buy groceries.

– The grocer earns money, and hires help or expands stock.

– The new employee now has income to spend at local shops or schools.

Each layer of spending fuels the next, multiplying the impact of the original earnings.

 Furthermore, there is significant evidence that women are better managers of money than men.  According to a report by our Deputy Minister of Finance studies find that women reinvest up to 90% of their income into their households and communities, compared to 30–40% for men.  This high level of savings helps generate economic activity as the banks have more funds to finance loans to start-up businesses, fund stock purchases or fund capital expenditure. 

There is plenty of evidence that women are potentially better managers of money than men, yet their full participation remains a missed opportunity — not due to lack of talent, but access to capital.

The Data Behind Her Power

The numbers tell a compelling story:

• Women make up 50.4% of South Africa’s working-age population, but only 35.8% are employed.
• Female entrepreneurs are more likely to operate in the informal sector and face greater challenges accessing finance and scaling operations for growth.
• According to the Global Entrepreneurship Monitor, only 4.1% of women own established businesses compared to 7.9% of men.
• Despite these hurdles, women-led businesses show lower default rates on loans — indicating enhanced reliability and resilience.

Closing the gender gap in employment and introduction of additional entrepreneurship could add billions of Rand to the national GDP.

Stokvels: Legacy of Leadership

One example that we discussed in the office when crafting this Financial View was thinking about stokvels.  Stokvels have existed in South Africa back to the 1800’s when farmers would pool their resources to fund cattle purchases.  These days however we think of stokvels as pooling of resources to be able to get bulk discounts on the purchase of groceries and the like, and now they are being used for so much more.

With over 11 million members and a collective value of R49.5 billion, stokvels have long been community-driven financial engines.  Led predominantly by women, these informal savings groups teach budgeting, accountability, and the principles of shared investment.  Today, many stokvels are evolving from household support structures into funding channels for small businesses, property investments, and education, thus laying foundations for a more inclusive economy.

Some of the uses of stokvels these days:

• Collective savings: Members contribute regularly, pooling funds to access lump sums for personal goals like education, home improvements, or emergencies.
• Rotational payouts: Common in many stokvels, where each member receives the full pot in turn, helping with budgeting and planning.
• Business funding: Members use pooled resources to launch or expand small enterprises, creating local jobs and income streams.
• Investment stokvels: A growing trend where groups invest in formal financial products, challenging the notion that stokvels are only for low-income households.
• Skill development: Some stokvels fund vocational training or education for members and their families.
• Insurance and emergency fund: A lot of the stokvels started off as a pooling of resources for funeral policies.

An impressive 82.5% of stokvel group members are women in South Africa.  That statistic alone speaks volumes about the role women play in driving these grassroots financial systems.  It is often the women that are managing the contributions, overseeing payouts, and guiding the stokvel’s financial decisions. 

Call to Action

This Women’s Month let’s shift the narrative. Let’s stop asking how we can include women, and start asking: how we can follow their lead?

Investing in women isn’t charity, it is a strategy.  It is a path to innovation, stability, and shared prosperity.  To unlock South Africa’s economic future, we must back the power we’ve long witnessed but too often overlooked.

Because when women rise, economies don’t just grow, rather they transform.  And South Africa currently needs to unlock real economic growth.