14 million Kenyans are in a Savings and Credit Cooperative (Sacco), but aren’t the majority from our parents’ generation? Still, many people see value in it so I did some research since I don’t want to miss out on a good thing. I found 4 awesome benefits to being in a Sacco.
1. You have an opportunity to save and receive dividends
Dividends are calculated on the savings you have. If the dividend during that year is 10% of your total savings, and you have saved Ksh.20,000 you will earn a dividend of Ksh. 2,000. It might look little, but isn’t it better than keeping the money under your mattress and getting nothing in return? It’s also better than a bank that will instead charge you ledger fees.
2. Members are allowed to borrow up to three times their savings
As long as you can get another member from the Sacco to be your guarantor, then you qualify for a loan. In comparison, a bank might need collateral such as a log book or land title deed which most young people lack.
3. Saccos help you maintain a high saving discipline which most people lack
One is expected to deposit a certain amount of cash every month. Saccos will assist you to develop a saving culture and be able to commit part of your disposable income for your future. Makes it a great accountability partner!
4. Can help you in an emergency
We all have been caught up in an emergency at one point in our lives. Saccos offer emergency loans such as for hospital bills or school fees, and they can be processed within a day depending on the urgency of the borrower. Members may have some flexibility on payment terms.
Okay, so you want to check out a Sacco. It’s a big decision that affects your wealth so choose carefully.
If you’re already in a Sacco, help your sisters by sharing your experience. The right Sacco is out there, it’s a matter of finding it.