Motshelo wins and wars: When mice and rats ‘eat up’ the money
Go simologile betsho! It is that time of the year again when the ‘noise’ around metshelo begins. Metshelo are a type of savings club in which a group of people agree to contribute a fixed amount of money to a common pool monthly for a particular purpose.
Many projects have been accomplished through these initiatives, with some groups making big purchases like cars, livestock, plots, financing agricultural ventures, group holidays, among others.
In some, members contribute a fixed amount of money monthly then receive the lump sum on a rotational basis and are free to use the money for any purpose. In others, members contribute a fixed amount of money toward the purchasing of groceries at the end of the year.
The buying season peaks between the beginning of November and mid-December, and purchases are made at outlets geared towards bulk purchases. The groceries that can cushion family gatherings during the festive season can even go up to April of the following year, with some products going even further. In some metshelo, members contribute a fixed amount to a common pool at regular intervals, and each member receives a lump sum equal to their monthly contribution at the end of the cycle, usually annually. In more forward-looking structures, members may search for investment opportunities that may grow their pooled funds. This may be in the form of interest from a bank account, buying stocks or collectively establishing or taking part in a business venture.
Some groups decide to use the funds to loan money to members and sub-members at a high interest rate for the sustainability and profitability of the group. This type has been known to create more challenges as a result of its high-risk nature.
Over the years, metshelo have been a great way that many Batswana are saving money throughout the year, but non-payment and defaults in payments have been a big challenge.
As a result of the fact that many are not formally registered or authorised by a financial services provider, they are not regulated. Therefore, fraud is also a common problem even though there is a gentlemen’s agreement based on the principles of trust, discipline and unity. Around this time, all those principles are out the window for some.
They have conveniently forgotten that they committed to the group and have to live up to expectations. But in some cases, there could be genuine reasons where members may want to withdraw from the group due to changes in personal circumstances but may not be able to get their money back. Disputes and fights between members can be nasty, leading to breakdowns and losses.
Financial services companies including commercial banks have come up with some products geared towards resolving challenges associated with metshelo. It is wise to consider such products and discuss them as a group before making contributions. This may be a perfect time to plan thoroughly for next year.
For treasurers, ga gona dipeba tse di jang madi, pay up!