Business

Sacco eyes Sh43 billion asset base

Friday, October 9th, 2020 00:00 | By
Sacco savings illustration. PHOTO/Courtesy

Steve Umidha @UmidhaSteve

Kenya Police Sacco plans to expand its asset base to hit Sh43 billion despite Covid-19 pandemic shocks and looming sector realignments.

“The outlook is positive and we are on course to surpassing our annual target despite the impact of coronavirus which affected most of our competitors…in fact as of September we had done better compared to what we achieved the whole of last year,” said the Sacco’s chair David Mategwa in an interview during the launch of its  digital systems yesterday.

The society’s assets grew by 20 per cent to Sh34 billion last year with annual deposits at Sh19 billion and a loan book of Sh29 billion.

Revenues grew to Sh6 billion from Sh4.5 billion the previous year.

Ambitious target

Going forward, the Sacco which is ranked second Investment Savings and Credit Co-operative union after UNAITAS, is eying an ambitious Sh43 billion growth in assets by 2021.

Kenya Police Sacco also intends to boost revenue with its new mortgage financing vehicle for its members pending approval from Kenya Mortgage Refinance Company (KMRC) to a slice of the state-backed affordable housing plan.

The bold move comes at a time majority of Saccos are staring at possible insolvency owing to mismanagement and Covid-19 aftermaths.

Further, the industry lobby Kenya Union of Savings and Credit Co-operatives (KUSCCO) warned of possible collapse of some SACCOs, especially those drawing members from worst hit sectors such as aviation, tourism, horticulture, small businesses, and transport that were severely hit by the pandemic.

Owing to the low deposits from members as well as a dip in demand for loans from members, KUSCCO said some Saccos could be forced to merge or fold altogether as a result of the pandemic as well as slow economic growth that had existed even before Covid-19 hit.

“Unless we rescue them they might not come back by the look of things and this is worrying,” said George Ototo, KUSCCO Managing Director.

Industry’s regulator Sacco Societies Regulatory Authority (Sasra) also says small Savings and Credit Cooperative Societies (Saccos) should merge since the top 20 entities control more than half of the total deposits

More on Business


ADVERTISEMENT

RECOMMENDED STORIES Business


ADVERTISEMENT