South Africans need to start saving for the national economy to achieve higher sustainable growth and development.
This was the call by Finance Minister Trevor Manuel at a breakfast media briefing on Retail Savings Bonds in Johannesburg yesterday.
He said the country's savings level stood at just under 14percent of gross domestic product with households contributing little.
"In South Africa credit is high and savings are low. The more families contribute to savings, the better off they will be," said Manuel.
He said the Retail Savings Bonds, which can be bought for as little as R1000 to R1million, were introduced four years ago to encourage a culture of saving among South Africans.
The National Treasury managed to attract investments to the tune of R2,3billion through the Retail Savings Bonds since 2004.
Manuel lauded low-income earners, saying they not only saved money, but were better at it than their middle-to-high-income counterparts.
The latest statistics by The South African Savings Institute show that while the middle and upper class are being squeezed on the back of rising interest rates, low-income households are saving on average 20percent of their monthly cash flow.
They also show that the savings percentage of low-income households was miles ahead of the 0,8percent national average household savings to disposable income ratio of the past 10 years.
"Middle and high income earners have a lot to learn about savings from low-income households," said Manuel.
He said low-income earners were using tools like group savings clubs and stokvels to pool cash and often when they cashed in they did not have an immediate use for it.
Phakamani Hadebe, deputy director-general of the National Treasury, said the bonds were better than other open-market investments since they carried no commission, agency or service fees.
"It (the Retail Savings Bond) offers competitive rates and allows investors to take control of their own savings portfolio instead of investing through a third party," said Hadebe.
A recent Old Mutual study showed that an increasing amount of cash was being invested in residential property, stokvels and burial societies as opposed to bank accounts and unit trusts.
The informal savings market is estimated at R12billion a year. According to the National Stokvels Association of South Africa the country has about 800000 stokvels and burial societies, representing 8,2million low-income earners with purchasing power of about R5billion.