Nakuru: Members of the Sauti Savings and Credit Cooperative Society (SACCO) have been encouraged to renew their membership upon retiring from active employment to maintain access to low-cost loans for personal development. Sacco national chair Mr. Elly Ndwigah highlighted the opportunity for retiring members to continue benefiting from the SACCO by rejoining, despite regulatory requirements to withdraw shares upon retirement.
According to Kenya News Agency, Mr. Ndwigah acknowledged that retirees could not access loans in the same manner as before. However, he assured that the SACCO would offer specially tailored products to cater to their needs. Retirees will be subject to separate regulations due to the absence of a steady income stream. These remarks were delivered by Board Member Mr. Milton Odhiambo Omondi during a members’ education day session for South Rift branch members in Nakuru.
Despite a decline in membership, the SACCO reported an increase in total loan uptake from approximately Sh103 million in 2023 to over Sh135 million in 2024. Loans disbursed in the past year included Development, Supernormal, Emergency, and School-fees loans. However, members’ deposits saw a slight decrease from Sh190 million in 2023 to about Sh188.5 million due to economic conditions and membership reductions related to retirements.
The SACCO experienced an increase in total share capital from Sh10 million in 2023 to Sh11 million in 2024. Additionally, dividends paid to members rose from Sh12.5 million in 2022 to Sh14.5 million in 2023. The 2024 dividend amount will be announced during the Annual General Meeting (AGM) scheduled for later this month.
Sauti SACCO members now benefit from loans up to four times their total deposits and extended payment periods, as well as the opportunity to increase supernormal loan limits. The SACCO is also automating its operations, including a new Management Information System (MIS) and mobile banking options, to enhance service delivery.
Mr. Ndwigah encouraged members to actively market SACCO products and recruit new members to expedite the Front Office Service Activity (FOSA) roll-out. He also addressed challenges with remittances from Kenya Broadcasting Corporation (KBC) staff, highlighting a backlog of Sh44 million since October 2021. Efforts to recover these funds are ongoing, though the SACCO remains financially sound with no loan application backlogs.
Sauti SACCO, established in December 1972, is a regulated non-withdrawal deposit-taking SACCO. It offers open membership to employees of government ministries and related agencies, including the Ministry of Information, Communications Technology, and Kenya Broadcasting Corporation. Presently, Kenya hosts over 14,000 cooperative societies, with SACCOs mobilizing approximately Sh400 billion in domestic savings, accounting for 33 percent of national savings.
The SACCO sub-sector is integral to achieving Vision 2030 by mobilizing savings for Kenya’s investment needs. Only 230 SACCOs in the country operate Front Office Services (FOSA) and are regulated. Deposits have shown a strong increase, rising by 9.95 percent from Sh620.45 billion to Sh682.19 billion in 2023.
Kenya is ranked first in Africa and seventh globally in savings strength, with savings exceeding Sh680 billion, representing 35 percent of total savings. Research by the International Labour Organisation (ILO) indicates that about seven percent of Africans are affiliated with the cooperative movement, with membership in regulated SACCOs growing by 6.57 percent in 2023. However, this still represents less than 30 percent of Kenya’s adult working population, suggesting significant growth potential.
A Ministry of Cooperatives report from June 2020 showed over 25,000 cooperatives in the country, with a membership exceeding 14 million. This sector employs 63 percent of Kenyans directly and indirectly, contributing to over 30 percent of national savings. However, challenges such as leadership, political interference, and financial mismanagement persist within cooperative societies.