The co-operative movement is set to play a key role in Kenya’s economy this year as more Kenyans continue to seek affordable credit for economic empowerment and wealth creation. The industry which according to the Ministry of Co-operatives and Marketing Development controls up to Kshs 230 billion is set to continue being major force in the national economy. It is no doubt that over the years, the co-operative movement helped to mobilize resources, created multinational enterprises and indeed employed thousands of people in Kenya. Saccos have also provided an alternative source of credit often at lower interest rates compared to banks. However for Saccos to compete favorably in the financial industry, they will have to embrace information communication technologies which they have underutilized, giving the movement a backward image.
By embracing ICT, Saccos will be able to manage their business as well as establish a proper mix of communication, distribution, and services channels for goods and services produced by the cooperative sector in the country.ICT will also help them access wide and lucrative markets both locally and abroad.
In addition, most Saccos will need to establish proper leadership and governance structures as recommended by SASRA that will ensure that they conduct business in a transparent and accountable manner. This will help fizzle out the corrupt outfit image that most Saccos have been associated with for a long time and make the sector respectable. It is also high time that the youth took over leadership of Saccos as this will give them an opportunity to inject fresh ideas and also provide them with a platform to showcase their talents, innovations and market accessibility.
Also Saccos will need to market their lending facilities and at the same time ensure that their credit acquisition process is well understood. Over the years, most people have shunned the co-operative movement due to misunderstanding the lending process. While most Saccos use guarantors as security for loans, the process has often been subject to abuse due to lack of debtor information and inadequate debt collection mechanisms. Therefore, the co-operative movement should consider establishing or partnering with information sharing bureaus which will help reduce loans default cases.
2012 has been declared by the UN as the international year of cooperatives. Therefore all the stakeholders in the co-operative movement should help Saccos in Kenya to take advantage of their wide network and public goodwill to position themselves to drive the economic agenda of this country.
