Category Archives: Articles

Excavating Silence:  The Social Grant Queue & Lockdown Farce

Governments are deemed to succeed or fail by how well they make money go round, regardless of whether it serves any useful purpose. They regard it as a sacred duty to encourage the country’s most revolting spectacle: the annual feeding frenzy in which shoppers queue all night, then stampede into the shops, elbow, trample and sometimes fight to be the first to carry off some designer junk which will go into landfill before the sales next year. The madder the orgy, the greater the triumph of economic management.

George Monbiot


I fume as I watch the news last night (4th May), as millions, around 3 million old age pensioners queue for their pensions.  I fumed along with a lot of other South Africans on the news plus on social media!

Long queues as government rolls out R200bn grants pay out ENCA

Residents of Nelson Mandela Bay in the Eastern Cape did not observe social distancing regulations as they came out in their numbers to collect their social grant payments. Long queues formed, from as early as 4am. Most wore masks, but with many scrambling to be first in line, it was impossible to adhere to social distancing. There were no authorities to monitor queues. SABC News


Just tried to get to P&P absolute chaos, hundreds of social grant recipients, packed like sardines, NO SOCIAL DISTANCING, if these people had to the queues would be a couple of KM’s.???? What now?

summer rose.

It took a pandemic for the government to realise that making elderly people queue for hours just to access social grants is VERY inconsiderate. To make matters worse, they’re still doing NOTHING about it!


South Africans who have been queuing since the early morning to obtain their social grants angrily demand that the South African Social Security Agency opens its offices.

Jaco Opperman

The lockdown has officially become a shit show. 4km queues for social grants is OK but you can’t buy socks… NDZ, BC and IP have lost the plot.


Such a long queue I saw at the Durban post office opposite the City Hall this afternoon… I’m sure majored of those poor pensioners did not receive their social grants today


Today, 04 May 2020, Queenstown was abuzz with grant beneficiaries. No social distance was observed. Elderly people stood one against the other in queues to the post office and local banks.

#UpdateAtNoon 104-107fm 

Queues for old age and disability grants formed as early as 4am this morning. The SA Social Security Agency (SASSA) calls on other beneficiaries not rush to cash their grants today as only old age and disability grants will be paid out today and tomorrow #UpdateAtNoon #sabcnews


@OfficialSASSA informed the public that older people + the disabled will be paid their social grants today and on 05 May to avoid overcrowding at stores, however pensioners have been standing on long queues since early hours in the cold, only to be told to come back on the 6th.


SASSA decided to prevent queues on the 1st of the month, all old age grants would be paid on the 3rd till 5th of the month in May and the rest mainly childcare grants will be paid from the 6th of May onwards!  Did it prevent queues of course not!  And to make matters worse SASSA F**** up many payments so some did not receive, and others got double payment!

The old age pensioners queue for hours, many sitting on the tar parking areas shuffling their bum up and along with the slow movement of the queue.  These are old age pensioners, grandmothers, grandfathers, elderly, infirm, deserving care and respect as our elders.  They deserve that care and respect in the best of times, and they deserve it even more in the worst of times.  They are queueing cheek by jowl with minimum amounts of social distancing, as if that distancing is possible when that many people queue down mall passageways, queues snaking, twisting and turning out into the parking lots and main roads!  No water offered or food available (unless they order delivery), bossed around by security to try to stand apart.  Most looked like they at least had masks!

WTF SA Government?  Stay at home, no ecommerce, no cigarettes, most small businesses cannot open, surfer arrested and and and!  BUT 3 million + old age people are queuing until the 5th, today, and then the rest will be queueing from the 6th.  Hang on how many will be queuing from the 6th?

The South African Social Security Agency (Sassa) will in May pay out R200 billion in social grant payments to 11.3 million recipients, which will see 18.6 million people benefit. (

Umm that’s more than 8 million coming up from Wednesday to also stand in mile long queues!  WTF is Bheki Cele threatening and wagging his finger PW Botha style.  We will lock you all up and revert to level 5 he threatened when he saw a few hundred joggers & walkers enjoying their 3 hours.  OK Bheki what are you saying about the 11million people queuing up for up to 8 hours?

The ineptitude is staggering, and the double standards are bordering on the comical!  But the government currently don’t have choices, because they have perpetuated this payment system.  I have written about this ridiculous social grant payment system, both in my book Kasinomic Revolution and in numerous articles .  The centralising of SASSA payments to formal retailers and banks not only costs grant recipients transport money, but also centralises money (and queues) to formal sector pay-out points, excluding small businesses and informal businesses, entrenching a non-inclusive economy!  There are better ways to do this and I personally know one initiative that would address this which has been stifled in the last few days which could change the way and cost of social grant payments.

WE HAVE TO DO SOMETHING ABOUT THIS… month end June, July, August are coming, mid-winter, flu season.  If social grant queues are not the biggest threat and danger to our nation’s health, if these payment queues are not Coronavirus infection killing fields then my name is Pol Pot!

But while we are on social distancing what about food parcels!  Food parcel queues on the news and social media stretch like election queues for miles through dusty shack settlement roads.  Last week, in Mooiplaas informal settlement outside Centurion 8000 people mostly foreigners queued up for hours for food parcels.  The “foreigners” don’t even get the luxury of social grants and the government is trying to pretend we don’t have millions of foreigners (legal and illegal) in our shack settlements who deserve help!  The Department of Small Business Development spaza assistance programme of a paltry R 3500, is conditional on being “100% South African”.  I wonder what 99% South African looks like!  Come on we have an uproar when the Chinese treat African immigrants like shit in Wuhan but we can do it here to our fellow Africans!

Bottom line is that we cannot feed this epidemic away, people must get back to work, particularly informal sector businesses and small businesses.  Let’s assume that the poor people in SA live in informal dwellings.  Contrary to popular perception, informal dwellings in SA represent only around 12 % of our total households.  Formal households represent 80%+ of our total households.  According to the 2108 SA Household Survey, 2.1 million households live in informal dwellings vs 13.5million in formal, and around 1.8million in traditional dwellings (probably a mix of informal, tribal style and formal dwellings).  Anyway the point is that how are you going to give food parcels to 2.1million households?  And add to that maybe 1 – 2 million foreigners! Food parcels no matter how well meaning and gratefully accepted will never stem the tide of need and need queues to dish them out.

How can any small business and outdoor activity be worse than queues for social grants or food parcels?  Can a hair salon in a backyard or a township street be worse than these queues, a bigger danger?  Or a Mayo street seller or sunglasses or cell phone charger street seller, or a kasi street kota outlet doing takeaways, a street vetkoek seller, or a barber or a domestic worker, or a gardener, or a kasi home renovator or kasi panelbeater or a runner at 11am or a surfer!  I can go on and on!

Let’s focus on the things that really are a risk and restrict these, let’s spend our time addressing queues of the most vulnerable. Vulnerable in risk and in poverty.

Mr Ramaphosa, Mama Dlamini-Zuma, do something about social grant queues, and let my people go back to work. I thank you!

Informal Sector & the Lockdown

I have had many questions about the impact of the lockdown & general Covid measures on the informal economy.  I have chatted to many informal businesses in the last few days and so here goes my humble opinion …

It’s important to note that the informal economy and the kasi economy are different, the kasi economy is in the townships, the informal economy is all around us, inner cities, robots, cbd’s, industrial areas etc.  I coined the term Kasinomics to describe the informal economy but have been at pains to point out that it was a term for a sector not a place.  Anyway, the point is that the kasi economy will be much more adaptable to the lockdown and survive better than the informal economy outside the kasi.  Most businesses in the kasi economy work from home or have a home-based business,

The lockdown will affect many badly and many not so badly.  So, for instance what I call the spazarette sector (vs hole in the wall spaza) will do better than many formal supermarkets in malls or CBD’s.  The spazarette is a supermarket style spaza (generally Somali) which is cheaper or on par with the formal retailer on the same branded products, is local saving the consumer transport costs and generally gives credit on food items to moms and gogos.  The spazarette being local can service the consumer better who is under lockdown.  To date reports are that around 80% of spazarettes are open, the balance open at busy morning and evening times only. The rumour was that only South African spazas could stay open (apparently started by minister of small business and SAPS applying this sporadically) . Hence the 20%.  Midi wholesalers – township and township periphery wholesalers, generally Somali owned, are open as of day 3. The spazarettes are not increasing prices, (consumers know the prices) but are reducing stocking levels as they are nervous about looting if / when people run out of money.

The hawker in a taxi rank or school yard will be seriously affected and only the more profitable will return to business, as their business points are closed and commuter traffic diminishes at ranks.   The kota and amaplati casual dining or takeaway business will be hammered where their business offering is to transit / inner city customers.  However, the outlet who sells to consumers from their home in the street will continue to supply the street or suburb, the community – whether its vegies or plates of food – amaplati.

Taverns and hair salons will be hammered, but many have reverted to selling “takeaway” alcohol or in the case of salons. doing a hair styling in the persons home. (not ideal but I am saying what will happen but not what’s right).

The massive backroom rental economy which I estimate to be worth R20billion in incomes will only feel the impact from end April as renters cannot pay rent where they have not earned money in April, for March people will still have earned salaries (obviously social grants will still be earned and are a massive driver of the kasi economies).  Importantly the rooms will be there when it’s all over!


One kasi bakery I have spoken to cannot keep up with local bread sales, he has switched from supplying unsliced bread to kota outlets, to selling to homes.  He has sourced an essential service licence and is busy.  There are lots of kasi bakieries out there who will adapt to this the same way.

Across the board informal businesses resilience will be based on low or no overheads, plus the kasi based businesses will still supply neighbours and community, and so on.

I often point out that the Kasinomics as a sector mirrors the gig or sharing economy as represented by the Ubers and AirB&B’s of the world.  Both are invisible, both are often home based, both are about massively fragmented models (ie scale based on a multitude of small business vs a few large businesses), both are hyper personalised to their customer.  Where they split is that the gig economy is heavily technology or app driven from payment to accessing customers.  The informal economy is not yet technologically driven – this represents a stumbling block and a massive opportunity now and in the future of the Kasinomic sector.  More importantly the advantages of home or residentially based gig businesses that are reflected in the kasi economy will contribute to the kasi economy’s resilience and survival.

In short, the informal economy is going to be seriously impacted, by closures of trading points on one hand but also by the impacted reduced spending / income in the total economy.  It is also unlikely that government will actually find ways to assist this sector.

I do believe however that the sector will prove to be resilient and able to batter down the hatches.  Apartheid could not suppress and in many ways created the kasi economy.  Today the strength and resilience of those vetkoek selling gogos, school mamas, shebeen owners, street veggie sellers, kota and amaplati outlets will be tested but will survive!

Excavating Silence: Essential Services are informal incomes and food on the table

An essential service can be an income or a job when there are no alternatives!  I believe that as a country we underestimate the scale of informal sector incomes and employment and of the role this sector has in food and income security.  As a result the informal sector has been excluded from almost all interventions to support small businesses. This excellent report highlights the needs and gaps in current interventions

The impact of locking down many informal businesses is having a bigger impact than is being appreciated.  This is going to result in a lot more social unrest – rioting, looting etc and or flouting of regulations as informal businesses find ways to trade under the radar, as they did in the apartheid days.  Heavy handed responses will exacerbate the grassroots response.

In 2019 I controversially suggested in an article published on BizNews that real unemployment i.e. where the person has no income generating opportunity or income for any form of permanent work, is probably closer to 12%. That’s a lot of jobs in the informal sector.

Consider that apart from the spaza and vegetable hawker sector operating during lockdown, the majority of informal business are not operating, including:

  • 50 000 informal food takeaways selling everything from a kota to vetkoeks, shisanyama’s and amaplate food trucks. A sector employing 200 000 odd staff “informally” and turning over in excess of R 85 billion a year! ,
  • The muti market is worth R18 billion in turnover employing almost 150 000 people,
  • 500 000 hawkers or table top vendors earn on average between R 1500 to R 3000 each a month in profit. Around a third of these are vegetable hawkers.
  • 150 000 hair salons ranging from home backrooms to colourful corrugated iron dunusa (barebum) style sell hair pieces and stylings worth millions every weekend,
  • Kasi auto businesses – 80 000+ kasi mechanics, services, panelbeating, car washes, tyres, sound systems,
  • There are just under 12000 township schools with a total of 60 000 school mamas selling snacks and food, earning between R 3 to R 6000 a month each,
  • Backroom Rental / Spaza rentals – more than R30 billion a year is earned in rentals by township homeowners. Rental they may not receive if the tenant is employed in the informal sector,
  • And there are a multitude of other businesses in these sectors including: kasi building, renovations, steel workers, renovators etc. Services – plumbing, electricians, catering & event suppliers’, tent, toilet and chair hire. Taverns and shebeens and on-con liquor outlets,

But like the matrix this trade and its scale is invisible to us, we don’t see its gleaming corporate headquarters, we don’t recognise its multitudes as they are in a caravan on the side of a road, a pile of veggies on a crate or a little chemist under a highway bridge.  Yet in many ways our economy is being sustained and driven by this sector.  Not only are these outlets and traders paying VAT on their substantial purchases but they are employing people and bringing in household incomes on a massive scale. In most cases the average Rand circulates more often in a township informal economy than in the formal economy.

The lack of any real interventions to assist this sector means that the impact of lost incomes whether business profits or wages for informal sector workers, will mean that the impact of lockdown is felt through a much larger part of our population than we give credit to.  This loss of incomes is going to mean hardship and social unrest.

The formal sector has a safety net, a large number of interventions are being rolled out, yes badly but nevertheless they are there .. if you are registered, on UIF etc.  Most large formal sector business have resources and interventions like tax relief, rental relief etc .  The informal business sector has no safety net, for them survival is an essential service!

I sadly predicted this in a BizNews interview with Alec Hogg on the 8th April:

It’s all very well that people receive their salaries at the end of March as well as their social grants, but at the end of April, a lot of small businesses aren’t going to be able to pay their staff and the informal sector will have not generated any income over April, so what happens then and in May? So I think that there is a serious risk of people just flouting the regulations completely on a large scale.. How do you deal with a mass social resistance?

What we’ll find is that – if we carry on with this and people don’t have incomes and people start running out of money to buy food – they’ll just go in and start helping themselves. You have to sympathise in some ways. This is not the right thing to do but what do you do if you’re living in Khayelitsha or Umlazi  or wherever it might be and you’ve actually now got zero money – you normally would have had a little bit of money – you can’t operate your business, you’re in a community that’s relatively tight knit, so you gather around your buddies and you go and help yourself. This will be the danger.

This is the headline in a Daily Maverick Article –

The biggest lockdown threat: Hunger, hunger, everywhere

By Rebecca Davis 17 April 2020

This article of course looked at food parcels and grants, they did not consider the great opportunity of freeing up the informal economy as a means of relief!  ON ENCA I watched a demonstration in Alex.  One woman being interviewed said in Zulu “let us open our hawker stands so we can make money to buy food”.  She did not ask for free food, she asked for the means to get food.

If we do not find solutions to this sector operating or getting support, we will have a meltdown in the informal sectors of our society. That is in no-one’s interest, let’s look at ways to address this before meltdown!

As an example, I proposed on various media platforms / forums, that in line with the SACCI proposal to allow drive throughs and takeaways to reopen,

Open fast food retailers, says business chamber as Ramaphosa extends lockdown

Apr 10 2020 15:40 Sibongile Khumalo


that the kasi kos fast food sector be part of this initiative.  I would suggest that there is a proviso for township outlets (like the proviso that drive through takeaways be allowed) that in the township space, it should be any outlet which serves through a hatch / caravan selling onto the street, i.e. not a sit-down / hangout type spot. About 10 000 of these are hatch type / caravans selling, kotas, amaplati, sishebos, chicken dust, mogodu etc. Letting these operate would make a huge difference to township incomes even if only those that adhere to regulations are opened.

A very recent report into SMME’s by the International Finance Corporation shows the majority of small informal or formal businesses operate from home or a residential property.  Maybe we need to look at this, allow home or residential street-based businesses restart during lockdown.

And what about once the lockdown ends or eases, how do these small businesses restart?  Issues that small businesses will have post lockdown include;

  • Cash to stockup,
  • Cash flow constraints while they start trading,
  • No terms at their suppliers to allow them to trade and pay later,
  • No credit lines to borrow to stockup or start trading again,
  • Limited or no access to formal business support offerings, including no benefit from tax, VAT, PAYE or UIF holidays,
  • No benefit of rental holidays – most informal businesses trade from residential premises,

We must build interventions that can assist with this both from private and public sectors.


Food parcels are not going to make any impact at any scale that will make a fundamental difference.   Besides, relief is short term, reviving or assisting informal businesses to restart is a greater longer-term sustainable platform than free food or grants.

I hope I am wrong, but I believe we will see more social unrest, before the lockdown ends but worst when the lockdown has ended, when the impact is most felt by the informal sector and the multitudes they support and employ.  Both private and public sector initiatives should not ignore this sector, we need to factor in this sector in our thinking and planning and to develop innovative and long-term support to the businesses that operate in this space.

Our greatest need, I believe is to find ways for the small businesses, and informal sector businesses to operate, safely, hygienically but this is where the pain will be felt and but also where we can possibly make a difference.

Excavating Silence:  Social Grants & Inclusive Economics & COVID 19

In a TED talk Bill Gross, the founder of IdeaLab identified that the right timing as the single most important element which made a new business or startup successful.

Mike Tyson said, “everyone has a plan until you get hit in the face”.

Both of these are very relevant in this time of COVID 19.  I believe the financial payment sector is about to be shaken up, in addition this is the perfect timing for change and success in the informal space, when it comes to non-cash payment offerings and building a more inclusive economy.


Lets start with an excerpt from Kasinomic Revolution, entitled Inclusive Economics, about social grants…


The wheelbarrow’s wheel wobbles back and forth, its bearing squeaking terribly as it weaves and bounces over the stony pathway zigzagging between scrubby acacia bushes and elegant euphorbias that tower over the path. Sweating, puffing and panting Sizwe strains against the lopsided barrow handles. He is only 14 and his skinny knees knock against the back of the barrow, his gnarled and rock hardened feet push against the tough ground. Just behind Sizwe his sister Thembi runs along carrying her granny, Gogo’s bag with her precious ID book and very empty tattered purse. The squeaking wheel is not loud enough to mask the low moans coming from the blanket shrouded figure of an old gogo on the wheelbarrow. ‘Basopa,’ Thembi says. ‘Sizwe, don’t bounce uGogo like that.’  Through his puffing and panting Sizwe manages a ‘Yo Thembi, ngiyazama, ilamatshe! I’m trying, it’s these rocks.’ He puts the barrow down and rests, bent over the bars. ‘Nxese gogo sesiyafika. Sorry, Gogo, we are nearly there,’ he says. He can hear the low murmur of the crowd in the distance and the little pathway emerges from under a giant tamboti tree, onto the road. From then on it’s easy pushing along the gravel road to Khumalo’s Store. The blanket moves, and Gogo pulls the blanket off her head, squinting into the sun at Sizwe, a tear from the sun’s glare trickling down her mightily wrinkled left cheek. Gogo’s dompas says she is almost 90. Until a year ago she walked here but then – yooo – her knees went.

Mtanami, kulungile, it’s OK, I’m sorry I am so heavy,’ she chuckles. She’s barely a bag of bones and has never been over five feet her whole life.  The little trio and the squeaking wheelbarrow make it out onto the road where Sizwe rests again and then, with a last gritted determination, he pushes on, the going a little easier now, to Khumalo’s trading store. In the style of the trading stores of old, Khumalo’s is much the same, its walls chipped blue square stone, with a faded red corrugated iron roof.

Today the road to the left and right of Khumalo’s Store, the yard in front, the veranda and every available piece of open space is filled with people. They started arriving at 4am staking their claim to a piece of roadside, to bed-sized squares in the store yard. The multitude of marketers set up makeshift stalls of old canvas advertising signage, torn gazebos, old doors on creaky wobbling legs, on cardboard sheets or even cow skin mats.


And while they set up shop the infirm, the bent, the crippled, the insane, the elderly emerge down a matrix of dirt tracks from faraway kraals perched on mountain tops, clustered on ridges and spread across the Tugela and Mhlangaan valleys. With them are their assistants, their families, their grandchildren. Some are carried on blankets, the edges knotted for a good grip, others on wheelbarrows like Sizwe’s, some hobble along on old homecarved walking sticks, clinging for support to a family member.


The air is filled with chatter, with hope, with humour, the wind drifts along with valley gossip, news, stories, loves and hates. Expectation radiates through the crowd. A queue forms at the front of the store. Well, not a queue, a human chain, wheelbarrows carrying people, others squatting, sitting, leaning, lying, each to their infirmity or their strength. The line grows as the sun leaps across the valley and picks up the shadows from the valley floor, the heat slowly building towards the 40s where it will soon peak.


Izinikuku, izinikuku, a call rises and falls from the old Hilux loaded with live chickens. Kabish kabish kabish, woza kumakabish is the rhythmic call from the lady sitting next to the huge pile of giant cabbages. Inyama nyama nyama calls the bare-chested man, his hands bloodstained, casually chopping pieces off cow and goat carcasses hanging from the branches of a wiry mgagane tree.

Amacanci, izidwaba, izicolo, amabhayi, imishayelo, imbadada, udabuluzwane, imiqelo woza uzobona.  Grass mats, pleated leather marital skirts, red ochre regal headdresses, violet and royal blue flannel cloaks, wild asparagus brooms, car tyre sandals, leather dancing shoes. The calls rise and fall around each marketer, the crowds taking their time, walking along, stopping to admire, enquire, negotiate, and acquire.


Shortly after 9am, when the sun is starting to make its heat felt, the shadows shorten and the crowd is at its largest, swirling, shifting and shouting, a cavalcade of white vehicles roars through the parting crowd. Police cars in front beep their sirens, white armoured bakkies follow and the cavalcade stops in front of the store. Machine gun toting police and private guards leap out of the vehicles strong-arming the crowd out of the way, glaring suspiciously left and right and clearing a circle in front of the store. They take up their positions and the armoured cars open their doors, clerks take their workstations inside and pension payout starts.


This is pension day 1980-style when, once a month, government pensions are paid out to the elderly and the handicapped. Until recently, the queues at Khumalo’s Store also included child grants to mothers, joining the old and handicapped.  In a country of black poverty, and most certainly in Msinga, the poorest district in South Africa, this is the lifeblood of the valley. As rain gives life, and brings renewed hope and belief in tomorrow, so does pension day. If you are lucky to have a father, a brother, an uncle with a job you can expect money. Migrant workers in faraway Kimberley and eGoli clawing gold and diamonds from the rock, or raising skyscrapers to the sky, send money home, but few have the luxury of these jobs.  For the rest, both the pensioners and importantly the marketers who travel from pension day to pension day within each district, the pension payout is a festival, an income stream and a great event.


The scene is repeated throughout the rural and urban parts of South Africa. As corrupt and inefficient as it is, the pensions and the pension days are the only income and commercial opportunities for local traders, craftspeople, small farmers, livestock owners and grocery sellers. Money makes its way into the rural and township bloodstream, it circulates locally supporting and nourishing local economies.


And then it all ended, pension days changed. Pension days were replaced by payouts at formal retailers via a PIN and fingerprint system and later a debit card used to withdraw at formal retailers, ATM’s & today drawn at post offices.


The reality of social child grants and pensions is that they are a wonderful and essential support to the poor, BUT they have increasingly been administered in such a way as to benefit the formal corporate economy.  The money does nothing to support informal retailers, informal markets or to circulate within local communities. In the old days pension days were huge market days where scores of small businesses and subsistence farmers in townships and rural areas survived on sales of food and goods. Today social grant recipients take a taxi to the mall, or in rural areas to the local town. There they draw their money and purchase at the mall or formal retailers in these towns … so much for inclusivity, empowerment and economic redress! (end of Kasinomic Revolution excerpt)


Only when money circulates within these communities and into these communities as well as out, does the pattern change. Only then do we create wealth and reduce inequality. Sadly, even when poverty alleviating government programmes like child welfare social grants are paid, they are done in such a way that, in the long term, the wealthy remain the beneficiaries.


The problem with the current system is that we compensate the poor in a manner which encourages economic exclusion, and we should compensate the poor in a manner which encourages economic inclusion.


Month end March – we saw on the news, queues, the old, the infirm, the poor, the mothers, the most vulnerable to Corona infection, queued up cheek by jowl at ATM’s and formal retailers, waiting to draw their money or stockup with recently drawn cash.

The same crowds rode taxis from home to the malls, packed in taxis where a double whammy impacts them, the lack of social distancing plus the cost of transport.  The cost of transport can be up to 10% of shopper’s monthly budget.  In rural Msinga the women must travel to the post office and formal retailers in Escourt, a round trip costing R 60, packed in the back of a single cab bukkie.  A hefty fee considering that an old age pension is around R 1860 and a social grant is R 445 per child, with an average of 2 kids per recipient.


This in a world of digital and electronic finances, where in South Africa, smart phone penetration is around 75% if not more plus an average of 2 debit / credit cards per adult member of the population.  Yet outside of a mall, most consumers cannot pay by card at 90% + of traders, nor can they draw smaller amounts of money at a withdrawal point in their street, or rural village.


This is why people draw all their money once off at an ATM at month end.  The lack of withdrawal points in walking distance, the cost per withdrawal plus the cost of transport outside of walking distance means they draw all their money, once a month…in a queue.


Banks like Tyme Bank offer free bank accounts, and most offer micro credit, but few if no financial institutions are providing means or points to use these accounts or cards to draw cash locally, or to pay for things like a loaf of bread, a taxi fare, a plate of food, a bag of groceries etc etc where the consumer lives and trades.  Or to deposit for example stokvel savings or cash wages close to home. In the absence of the ability to pay or draw to pay for daily and weekly items bank accounts will and do continue to be post boxes, with all the money drawn once a month.


People do not prefer cash, the rubbish notion that black people prefer cash is an urban legend. They have no alternatives!


The state is desperate to distribute social grants deeper into the community at a cheaper rate and saving consumers cost and inconvenience of transport.  Added to this today and exacerbating the issue is the Covid-19 social distancing need, which will continue into late 2020.  The state will pursue more and more options to decentralise payments.  Already the dates for payments have been changed from month end to spread the rush .


Today marks the greatest opportunity in the recent history of our country to fast track financial transactional solutions which resolve peoples real financial issues and pain points plus offer lower infection risks.


  1. Cash Withdrawal

Right now, we need cash withdrawal options at spazarettes and other smaller less formal kasi outlets, resolving social grant and pension withdrawal issues.  These withdrawal points should incentivise smaller more regular withdrawals at reasonable rates per withdrawal. If I can draw small amounts of cash weekly close to home, at a concomitant low cost per withdrawal, I will only draw for the week.  Imagine if people could draw small amounts of cash daily or weekly at a great rate at the spaza or local kota outlet, hair salon or tavern!  No transport cost, cost effective small amounts, less crime risk, no queue, no brainer!



  1. De-cash the system

The handling of cash is an issue, touching of notes an infection risk.  What a great opportunity to de-cash the system, when the entire informal eco system is thinking differently about cash!  If consumers could pay using cards at a multitude of points and traders could accept low amount payments at a low or nominal cost per transaction, then consumers would not even draw money, a situation we see with Mpesa in East Africa.  Today any card payment costs the trader between a 2.6 – 3% fee (in China I believe it’s less than 1%), not counting the cost to the trader of data to operate the card device or cost of paper.  Depositing cash is cheaper than accepting card payments. A spazarettes typical net margin is 10%. Considering these elements, no wonder traders don’t want to accept card payments.

So what opportunity exists to offer the ability to both withdraw small amounts of cash at your local informal outlet, plus on the same platform accept card payments at a rate which incentivises a trader to encourage card payment.


But you will say there are many options and devices in the trade.  Not true I say, currently the vast proportion of innovations if one can call them that is in devices which let traders buy and sell airtime, electricity, bus tickets, send money and so on.  Plus they allow traders to pay certain suppliers electronically.  But to pay electronically using the device the trader must still load money onto the device at an ATM or similar as he has received payments in cash.  This is ridiculous, and inefficient. None of the offerings today let the consumer withdraw cash let alone withdraw small amounts of cash at a reasonable rate.   The balance of products are wallets or money transfer offerings.


No low cost, low fee options exist where a consumer can use their card to buy as little as a loaf of bread at a point in walking distance to their home, or draw small amounts of cash from the same point cost effectively.


We can resolve pain points, save consumers costs, drive deeper economic inclusion and build a great business.  And the further benefit is to drive money deeper into the community, driving spend, turnover and economic inclusion at community level.   It can be done, especially if we take a long term low profit view investing in our economy and our low income kasi populations


Ke nako, manje manje. We have been hit in the face, the timing is right, lets not waste this crisis.

Excavating Silence:  The impact of the lockdown on the spaza & informal retailer

Ali is a bright and breezy Somalian, who has been in South Africa for 9 years.  He has an ID (non-resident) and SA drivers’ licence, so he is not an illegal resident. In fact many immigrant traders from Somalia do have some form of legal paperwork. The Somalis coming from a conflict zone can get official asylum status, the other 3 groups that make up the majority of the spaza sector, Ethiopians, Bangladeshis and Pakistanis are economic refugees and generally struggle to get asylum and as such are often illegally resident.  His business is registered with CIPC and relevant municipal requirements.

The robberies got worse and Ali looked around for a job in a shop.  “In November 2015 a friend of mine Hassan and his three other partners requested me to manage this shop where I am now.   They gave me a 25 % share. From then we expanded and opened 3 other outlets in Tembisa namely Freedom General Dealer 2,3 and 4.

Ibrahim Abdullahi has introduced me to the world of spazas, spazarettes, cash and carries and midi wholesalers.  Ibrahim knows this sector intimately, he’s a natural marketer and a whiz at getting brands distributed and listed into these stores, whatever the nationality.  His network and understanding opens up a retail world that is to a large extent invisible, mostly misunderstood and much maligned.  His business Hornafro Marketing ( ) accesses the world of the Somali trader and networks.  He is helping me keep in touch in this time of lockdown.   Ibrahim has introduced me to Ali’s story and that of Freedom General Dealer, which is very representative of the world of spazarettes in the townships.

Freedom General Dealer is on a busy intersection in Tembisa.  His store is what I call a spazarette, a supermarket type spaza with aisles, a huge range of brands and product sizes all priced on par or cheaper than formal supermarkets.  There are approximately 30 000 spazarettes, and a further 70 000 hole in the wall spazas.  At the back of the neat store with 5 shopping aisles is his “wholesaler” section where he sells bulk goods to hawkers and local food outlets that sell food like kotas, amaplati, vetkoeks etc.  This wholesaler section contains bags of sweets, large multipacks of savoury snacks for hawkers, and for the fast food sector big bags of flour and maize meal and 20 litre oil for vetkoek, pap and meat or slap chips meals.

Ali offers credit without interest to the locals, and any given month he has loans of up to R 10 000 for food items bought by between 50 and 100 gogos and moms. He only gives credit to gogos and moms, “only the trusted neighbours, moms and gogos, they’re reliable to pay back,” he says.   I also give charity he adds, “the local councillor will come by and ask for supplies towards someone’s funeral in the community, maybe they were a poor person. We give free food towards these.”

Ali rents the property from a South African and pays R 5000 a month.  This rental is an often ignored benefit of the immigrant spaza sector.  I calculated in Kasinomic Revolution that the spaza sector pay around R 30 billion a year in rental to South African homeowners.  Money they will continue to pay to the homeowners if they continue to trade during the lockdown.  An important and much needed income.

Ali does not see the formal sector as his main competition, he says “my main competition is other spazarettes, but recently the PicknPay which opened close to me, they are new so for now they are competition”.

Before the lockdown Ali’s business was growing well with turnover increasing despite the hard-economic times.  I ask him why he thinks this was happening? “Because of our long working hours, good prices and high stock levels in our store.”

I ask about his relations with the community considering the bouts of xenophobia that happen.  “The community are treating us well because they value our business. They can get what they want from us any time of the day which costs them nothing in terms of taxi fare. They send their children to shop at any time, because they trust us.”

So, what has happened since lockdown.

“Our business has been disrupted.  Police are disrupting our working hours forcing us to close, while we have got all the required documents.”  But despite this business is up over the lockdown, “Except the first day, our business is doing better. Customers are buying well like at month ends.”  Items like DSTV, airtime have gone up over this time.

The spazarette is in the street or on the high street, the busy street running through a residential area, unlike the spaza which is a tiny hole in the wall in the back streets. This proximity to consumers, the range and price means that the spazarettes save customers transport to the mall or shopping centre.  The result, the spazarette sector will probably grow turnover over this period.

Freedom General Dealer’s wholesale section is suffering compared to his supermarket section.  “The items there that are not moving are, 12.5kg cake flour, 5 & 20l oil, snacks like 50 cent sweets in bulk.  You see this is because most of the customers buying the above items either had kasi kos food takeaways or are tabletop hawkers.”

How do you plan to survive this lockdown?  “We are trying hard, going from wholesalers to wholesalers to get stock at the best price so we can pass this price onto our customers.”  Ali says some wholesale prices have increased in price by about 7 to 10% since the lockdown. Ali is more concerned about his customers “We are also worried because 50% of Tembisa resident are foreigners who rely on daily income like selling in the streets or work like waiters. They don’t get grants from government to replace their income.  But I even worry about many local people.  They rely on informal jobs, like kota shops, salons, building houses or labour work.   So they may run out of cash to buy food and loot the stores.”

For now, Ali like most spazarette owners has reduced stock levels, and restocks more regularly so that if there is looting, he loses less and can survive through the time and afford to restock again.  He is also ensuring his customers are protected, “we have taken all the precautions, we have gloves, face masks, sanitizers and we tell our customers about social distance, that they must be 1 meter apart.” I suspect that this is true for most larger spazarettes but not the norm in the smaller ones and in the spazas.

I ask him if he has plans for after the lockdown?  He is positive, after all he has survived the ravages of war in Somalia.  “No specific plans.  We hope to continue trading no matter what.  Yes, we are positive about the future. No bad condition is permanent and there will a solution to every problem.  Even this one.”

Observations of future trends

  • The prepared / hot food sector (currently closed) – fast food, catering and casual dining e.g. shisanyamas is going to seriously impact township incomes, considering that this sector unlike the spaza / rette sector is 100% South African owned. Ditto the street traders excluding vegetable traders.  This is also going to have an impact on food manufacturers and farmers, as a large portion of many categories of vegetables and food sales go through these food channels.
  • The real impact of lockdown will only be felt in April and May, when the impact of no trading in April is felt by the majority of the informal trade which has not been able to trade or has had reduced business, (not all informal businesses are spazas 😉). These include taxi owners and drivers, hair salons, fast food outlets & shisanyamas, taverns, non-vegetable hawkers, kasi internet cafes, kasi mechanics, muti traders, school mamas selling snacks to school kids, creches, caterers, kasi builders, car washes, among others in the kasi economy.
  • The spazarette sector is going to strengthen through and after this. Consumers will buy more of their groceries locally ie at the spazarette, for convenience and saving taxi fare.  A trend which was already in evidence before this lockdown.  Formal retailers in township suburbs will also benefit at the expense of malls and shopping centre based retailers (except at month end).
  • Number 2 brands will benefit as consumers trade down but try and stay with quality. Smaller packs sizes will grow in volume as consumers trade down from say a 1 Kg to a 500g, spazarettes are already seeing this growth of secondary brands and smaller packs.
  • Consumers shopping at spazarettes are already reverting to basics, staple food and non-luxury items. The exception is sweets, sodas and snacks. I suspect “I deserve a treat even if it’s a little one”. (the lipstick factor)
  • The majority of the small businesses, including the informal sector will struggle with restarting. They will have lived off their resources over the lockdown and will have no money to restock.  The lack of access to credit, terms on purchases, and limited government interventions (at this stage) exacerbates this issue.  On the other hand low overheads, agility and the fact most operate from residences / residential premises mean they will start slow, with small quantities of stock and slowly rebuild.


Excavating Silence:  Let them eat Bread or Vetkoek

And there are many people on whom the written record is almost completely silent. To get to know anything about such people we have to excavate silence. By Mbongiseni Buthelezi

Excavating Silence: Kasi Convenience

I have decided to do a series of profiles on informal businesses over the lockdown called Excavating Silence. This to 1 tell the stories of people who are otherwise invisible & unrecognised, 2 get them noticed and maybe help them get partnerships with larger businesses, 3 maybe the lessons they contain can help authorities consider them and cater for them.

In Kasinomic Revolution I wrote this story about a couple I called Golden Delicious who sold vetkoek in downtown Joburg.  They’re not there now, the streets of downtown Joburg are silent and deserted …

It’s 1am, Meadowlands, Soweto. The alarm on the scratched old Samsung beeps endlessly. Mbandze reaches over his wife Veronika’s sleeping body and switches it off. Nudging her awake, he walks into the kitchen of the tiny two-room backroom and switches on the electric kettle for tea and to fill the two plastic basins he and his wife use separately for washing, standing in the basins.

After quickly drinking their tea while they get dressed, they walk into the room next door which serves as both lounge and kitchen. The ten plastic 25-litre drums of dough they mixed before bedtime at 8pm the night before are lined up there. They transfer the risen dough into 6,25-litre buckets and close them tightly.  Veronika packs a cooler box with Parmalat Cheese Slices, sliced polony, fried fish pieces and long-life milk.  While she is packing the cooler box Mbandze has walked out to the street a few times taking the buckets out. Throwing two clean aprons into their bag, the two walk out into the narrow township street. It’s 1.45am when a 16-seater Toyota taxi pulls up. The two of them take a whole bench seat in the taxi, with their six buckets and cooler. Wordlessly, Mbandze pays the driver R48 as the taxi wheezes and sways along on its worn shock absorbers to Noord taxi rank in downtown Joburg.  It’s cold and dark except for the dim street lights and the brighter light of the old Springbok Hotel entrance.

It’s 2.30am when they alight to find the guy from the storeroom waiting at their small section of pavement with a trolley. They pay R30 a week to have their table, gas cylinders, pots and kettles stored. Mbandze nods silently at the trolley pusher and, unloading their items, he sets up his cooking area while Veronika lays out their wares on the table: tea and coffee, sugar and milk, polystyrene cups, a Tupperware containing the cheese and polony slices and the large basin ready for the amagwinya.

By 3am the first vetkoek are frying into a delicious golden brown, and the crowds start passing by. Downtown Joburg is a frenetic mix of slums, corporate head offices of banks, and government buildings – the first and third worlds slammed together in a heaving uncomfortable mess, the rich resenting the poor, the poor aspiring for just a tiny fraction of what the rich have. More than half a million commuters stream to and from Park Station daily and many stop at Mbandze’s table top. His hands moving in a blur Mbandze grabs handfuls of dough and expertly beads each into a perfectly round and identically sized lump and drops them into the boiling hot cooking oil in a huge aluminium pot on the little Cadac stove. Two hundred golden brown vetkoek fry at a time before they are poured into a large plastic bowl where a frenzy of hands reaches out, buying the vetkoek with a Parmalat cheese slice melting into the hot dough, or a fried slice of polony, or a cup of tea or coffee. Mbandze and Veronika start selling their vetkoek at 3am and by 10am they have sold 3 000 at R1 each. They make a margin of about 40% earning themselves up to and above of R 30 000 a month, a hard but a good living.

Across the street Moipane Mahlakwane (profiled here by Kyknet ) sells 6000 vetkoek for R1 each.  She’s 24 and moved to Joburg from Limpopo some three years ago, searching for a job, fame and fortune. She could not find a job and so inspired by her mother, found fortune selling vetkoek.  Selling 6000 vetkoek a day at a rand each, she earns her a good income and now employs 4 staff.

Both Mbandze and Moipane’s businesses are closed today.   They operate in the inner city, the lifeblood of their business is commuters and office workers grabbing the Mzansi breakfast croissant, vetkoek, on their way to work.  I weep for them but I suspect they will be back in force once the cities and the streets return to normal.

Meanwhile in Soweto another Kasinomic Revolutionary is not letting the lockdown put him down!

Refiloe Rantekoa grew up in White City, one of the toughest and poorest suburbs of Soweto, epitomised by concrete rooved homes looking like air raid bunkers.  When I started visiting Soweto in the late 80’s I was warned about White City.  Apparently in White City if you saw a bunch of guys fighting, it was because they were fighting over who would mug you.  My friend Ike Mosiuoa said, “GG when you ask the gogos for directions, they reach into their breasts, pull out an Okapi knife, flick it open and draw directions in the dust for you!”

Refiloe was eight when he started selling vetkoek with his gogo.  He would wake up early and they would sell before he went to school, heading off to school from the little bucket of vetkoek on the dusty sidewalk.

Finishing matric Refiloe could not find a job so started printing and selling T shirts with African maps, or local heroes like Mandela.  His little backroom, a one room tiny space behind the main house in White City, was his printing studio, lounge, kitchen and bedroom!  Some years on Refiloe got a learnership and later a job in the hospitality and tourism industry.  It was a great job in a world where no one has formal jobs, but” business was in my blood” he tells me.  “While I was working I was thinking and researching, what business could I make my mark by starting.  A business I could scale up” he continues, “even at work I was selling to the people at work, like ama-aachar (atchar), even happy socks, and boxes of Kellogg’s cereal”.

Then the memory of his now deceased gogo, drove him towards baking.  In between his  work at the office, Refiloe designed a bakery logo, staff T-shirts and started researching the cost of equipment.  He started selling his bread too, not real bread though!   “I said to people and to kota outlets, I am going to sell bread soon, will you buy, how many loaves, what price.”  He laughs, “I sold lots of bread like that, but I was selling something that I don’t have.  But that was my research, advertising into engekho (something non-existent).”

At the same time Refiloe got a personal loan, using his payslip. “I borrowed R 50 000 and I bought baking equipment.  I just stored it in my little backroom.  It sat there for a while though.”

And so Borotho Bakery was born, a virtual business, a young man’s dream plus a pile of baking equipment crammed into a backroom alongside a little bed in White City.

Then people were saying “hey where is that bread, they were serious, and I realised I need to be serious too.  Yo the pressure was building up and up.  But space was the problem.  Where could I start this bakery?”

That’s when he decided he would use his backroom bedroom behind his grandmother’s house as the bakery.  He had nowhere to stay, so “I went back to my family home, and said can I stay here, I slept on the floor in the dining room for a while.”

So in 2016, at first baking only 20 loaves of bread a day, Borotho bakery went from virtual business to reality.  Refiloe started selling just up and down his street, “at that stage we did not think about making a profit, just to get the business going.”   Using WhatsApp, Refiloe started getting more and more orders, 6 loaves here, 2 there, more and more streets started buying his bread.  Then the kota outlets started ordering. (A Kota named after a quarter loaf of bread, is the township hamburger, a bit like a bunny chow but with chips, polony cheese slice inside vs a curry.)  And the pressure mounted on Refiloe and his two baking partners.  All the while Refiloe was also in a full-time job, he had no choice he was servicing the R 50 000 loan he had used to start the business.

By the end of 2016 Refiloe had more and more orders, so they sourced some trolleys kasi stayela.  He laughs when I ask how he sourced these, “you know mos ekasi!”.    His trolleys delivered up and down streets, business was looking good, they were selling about 350 loaves of bed a day.  Trolley vegetable sellers with their trademark bicycle bell are common in the townships streets, bread sellers are not.  Refiloe was learning and adapting his business to kasi dynamics.  All of this still from Refiloe’s grandmother’s backroom.

Towards the end of 2017 to early 2018 Refiloe had been feverishly entering every entrepreneur competition or initiative he could find.  One prize got them money to buy a small truck and a shipping container.  “Ya space is an issue ekasi,” he says.  The shipping container was squeezed onto the tiny residential property in White City, just in front of the backroom.  And that’s where Borotho Bakery is operating today.  Smiling ruefully, he says, “it’s very spacious compared to where we were operating before”.  How’s that for perspective, a shipping container is spacious.  I guess when your premises were a backroom, then its huge!

“It’s now very professional” he says, without a hint of irony, “we have a sign and people can see where we are.”  Borotho bakery’s truck delivers but he has just restarted the trolley sellers.  “We designed stronger trolleys” he says, “the supermarket ones don’t work on the kasi streets”.  So with new trolleys and branded umbrellas proudly shouting out Borotho Bakery, 4 trolley sellers walk the streets every day.  Orders still flood in via Whatsapp and the trolleys rattle down the tiny kasi streets selling or delivering.

And then came the lockdown!  Borotho bakery lost 25% of their business immediately, some of it from the closing of fast food sector, primarily the kota outlets, plus a large client at Baragwanath hospital.  But the trolleys are picking up the business.  Refiloe got an essential service permit and now each trolley and the truck are focussing on residential sales.   He’s upbeat, optimistic, he has a plan, a strategy.  “We were becoming too much traditional in the way we were doing business” he says, “so I want to do things differently.”  He planned to have 10 trolleys but the lockdown closed his supplier, so his trolley sellers just walk further.  “We now have orders as far as Rockville, even Dube, so the guys can walk about 10 even 15km’s a day”. Each trolley has a permit, gloves, a mask and sanitiser.  “They engage with a lot of people, so its important that we do the right thing” he says proudly.

Refiloe has a recurring dream, it’s a dream of space, space to grow his bakery.  He has woven magic with the tiny space cast his way, starting Borotho bakery in a space no larger than a townhouse kitchen, squeezing a container into a tiny Soweto yard.  Imagine the magic he can weave, the loaves he can bake if he has space.  “There are so many spaces with closed stores ekasi, but we can’t get those places!  Maybe the government should help and take these that are not working and make them available to us small businesses.”

Refiloe doesn’t want a handout, he’s agile constantly looking at reinventing his business, enthusiastic and articulate, he knows these kasi streets and these kasi people.  Lookout for him, if he gets that space, there is no holding him back, lockdown or no lockdown!