SACCOS: Enough of the old ways
SACCOS: Enough of the old ways
By Josephine Gikaru
Savings and credit cooperatives (SACCOS) in Kenya are as important. They provide a great alternative from banks. In fact they offer products and services that many financial institutions have not been able to offer. They are flexible. A farmer in the rural part of the country is able to facilitate his farming with the help of Sacco’s and so is a business woman in the urban center able to stock up their business. Sacco’s’ have therefore grown into an integral part of the financial system and even with the positive vibe there needs to be regulations.
Also read:How to answer the frequently asked interview questions
Top story: schizophrenia-the-white-mans-disease
The old ways have served us well enough. Change is inevitable and fair enough Sacco’s have to change in various aspects to ensure that they keep afloat. Risk is pervasive in financial systems globally and for a rapidly changing dynamic industry then regulations that protect and allow growth are important.
Over a long period of time most failures in Sacco’s have been attributed to mismanagement and greedy individual. Over the last few years several Sacco’s have collapsed, placed under statutory management or have liquidity problems with outright mismanagement by those entrusted to oversee their growth. Some are under receivership as they await liquidation. The Sacco Societies Regulatory Authority (SASRA) has done a fair share of the job while enabling the institutions to thrive in a less toxic manner to guarding innocent Kenyans from cons. The regulator remains a toothless dog to see that Kenyans have not been fully protected and face challenges every day.
In addition is the falsification of financial statements. At a time when transparency, accountability and good governance chairs the cooperate world, Sacco’s continue to place their members in a fake success bubble. Sacco’s are continually preaching about huge profits in the race towards growth which is deceiving. Most people enjoy the property ownership ideas portrayed by various Sacco’s and are therefore usually in a hurry to become members.
Development has been made in the Sacco’s and we therefore would not compare them to when they begun. With that however there is still so much to be done to ensure that Kenyans are not robbed off their hard earned money.
