Saccos are a sustainable alternative to traditional banking systems

By Dr Gamaliel Hassan | 4mos ago

Traditional banking institutions are facing increasing scrutiny for their environmental impact as well as their role in perpetuating economic inequality.

Savings and Credit Cooperative Organisations (Saccos) have emerged as the new frontier for development in Kenya.

With their flexible financial solutions, Saccos are transforming the lives of ordinary citizens by providing them with access to credit and savings facilities.

One of the key advantages of Saccos is that they are member-owned and controlled, which means that members have a say in how they are run.

This democratic structure ensures that the interests of members are always at the forefront of decision-making. Moreover, Saccos offer their members a wide range of financial services, including savings accounts, loans, and insurance.

The flexibility of Saccos is another factor that has contributed to their success. Unlike traditional banks, Saccos do not have rigid lending criteria that can exclude people with low incomes or those who lack collateral.

Instead, Saccos offer flexible loan terms and repayment schedules that are tailored to meet the needs of their members.

Saccos have also proven to be effective in promoting financial inclusion in Kenya. With their focus on serving the needs of the underserved and unbanked, Saccos are helping to bridge the gap between those who have access to financial services and those who do not.

This is particularly important in rural areas, where traditional banks are often absent.

To address these challenges, the Kenyan government and other stakeholders are working to improve the regulatory environment for SACCOs and to provide support for their growth and development.

This includes efforts to strengthen SACCO governance, promote financial literacy among members, and increase access to funding through initiatives such as the SACCO Societies Regulatory Authority (SASRA) Deposit Guarantee Fund.

In recent years, Saccos in Kenya have experienced significant growth and have become an important source of financial services for many Kenyans.

As of 2021, there were over 15,000 registered SACCOs in Kenya with a total membership of over 14 million people.

At Stima Sacco, we offer affordable and flexible loan facilities to provide attractive investment options for our members.

Through our robust digital platform, members can access their accounts and transact from anywhere in the world, at any time of the day or night. This level of convenience is unmatched in the Kenyan Sacco sector.

Another advantage of Saccos is that they are able to offer their members competitive interest rates on loans and savings.

This is because Saccos operate on a not-for-profit basis, which means that they are able to pass on the benefits of their lower operating costs to their members.

In conclusion, Saccos play a crucial role in promoting financial inclusion and economic development in Kenya.

With their member-focused approach, flexible financial solutions, and competitive interest rates, Saccos are transforming the lives of ordinary Kenyans by providing them with access to credit and savings facilities.

As such, Saccos are the new frontier for development in Kenya, and their impact on the economy is set to grow in the coming years.