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SACCOs response to Coronavirus pandemic

By Sara Okuoro | May 21st 2020 at 10:00:00 GMT +0300

The financial services sector in Kenya and globally, continues to reel as the Coronavirus pandemic takes its toll on livelihoods, businesses and economies and healthcare.

In Kenya, more than 963 people have contracted the virus, with 50 succumbing to the illness.

The Kenya Union of Savings and Credit Co-operatives (KUSCCO) has cautioned its members against throwing caution to the wind, reminding them that they are still in the woods.

KUSCCO has advised members on various fronts regarding the pandemic.

Cyber-security

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To prevent fraudulent loss of members' money through cybercrime, there is need for a comprehensive systems audit and adequate cybersecurity systems in place.

Loans

There will be dialogue with members seeking interest waives and suspension of loan repayments. These will be handled on a case by case basis. The interest waived should however be paid after the pandemic to cushion the SACCO from cash flow issues.

KUSCCO has also urged its members to exercise a high degree of judgement to distinguish between borrowers who are temporarily vulnerable because of the pandemic and will be able to cope in the long run, from those who are unlikely to become solvent again. Guarantors will be given a moratorium of three to six months.

SACCOs have also been directed to improve the turn-around time in handling customer complaints especially those related to loans.

Withdrawals

Limits will be set to manage cash reserves in the event of a run or panic withdrawals. To further curb this, members can be engaged with short-term loans equivalent to their savings.

Virtual board and committee meetings

To handle disruption caused by cessation of movement in some counties, the board of directors should adapt to online meetings in line with the current technological trends.

KUSCCO has however advised that the by-laws should be amended to allow for this in the long run.

Health precautions:

Masks, hand sanitizers, infrared thermometers and gloves should be procured for the lean team of staff deployed countrywide; besides fumigating office premises regularly.   


COVID-19 SACCO Coronavirus
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