Sacco deposits to hit Sh800b in eight years

Kenya: Members’ deposits under the control of Savings and Credit Co-operative societies (Saccos) are likely to reach Sh800 billion in the next eight years.

Industrialisation and Enterprise Development Principal Secretary Wilson Songa said by the end of last year, Saccos had mobilised Sh460 billion in member deposits.

“This amount is expected to grow to Sh800 billion in the next eight years. This will give the co-operatives an edge as they seek to compete with commercial banks to enhance financial access to customers,” said Songa.

Songa made the remarks recently during Harambee Sacco Society’s Annual General Meeting, which was held in Nairobi.

He called on Saccos to invest in processing activities in the agricultural sector. He also urged them to contribute to food security in the country by supporting agricultural activities through bulk procurement of farm inputs and advancement of affordable credit to the sector.

The Sacco announced plans to expand its membership during the meeting. Its chief executive officer Peter Ndegwa said plans are at an advanced stage to hire 20 business development executives to help with the recruitment of new customers.

Currently, the Sacco has 86,934 registered members, and is rated among the top 10 Saccos in the country. The planned recruitment of new customers is expected to help it expand its market share.

According to the 2013 Annual Sacco Supervisory Report, Harambee Sacco assets base stands at Sh17.6 billion compared to the Sh24.5 billion of Mwalimu Sacco, which is the leading deposit-taking Sacco in the county.

positive growth

Once recruited, the Sacco’s new business development executives will be deployed to various regions across the country.

“Our new approach to business in the co-operative financial segment is customer acquisition and retention.

“This will enable us to expand our market share, recruit more customers and retain them. We are also working on plans to enhance internal controls to eliminate cases of fraud and other malpractices,” said Ndegwa.

 

The Sacco’s asset base grew to Sh19.8 billion in 2014 compared to Sh17.6 billion registered in 2013. Loans to members increased from Sh14.2 billion to Sh15.6 billion, while investments grew from Sh294 to Sh476 million.

Share capital increased by 216 per cent to Sh1.6 billion in 2014 from Sh517 million in 2013, while members’ deposits grew from Sh12.46 billion to Sh12.48 billion.

The Sacco’s chairman Macloud Malonza said the institution had registered positive growth in the past few years and was sure of better prospects ahead.

“We will surprise our competitors and doubting friends,” said Malonza.

He said the institution will open 40 satellite offices across the country to enhance provision of services to customers.

“This project is in progress and we have consulted the Sacco Societies Regulatory Authority (Sasra) to come up with the best approach to make our venture successful,” said Malonza.