How to Open a Savings Account that Enables You to Borrow against Your Savings?
March 26, 2018 | BY MOMBO
For people of low to medium income, getting financing through banks becomes more and more difficult. Reasons for rejection are many. A credit history that is far from ideal or incapability to provide collateral, to name a few. Does it mean you have to give up your dream? Of course, no! We will tell you how to open a savings account at a trusted SACCO and borrow 5-fold your savings! No collateral required!
Why opt for savings and credit cooperative societies?
Getting a loan from a bank is an uphill task that requires an impeccable credit history. The bank will not give you money if you’ve got a low credit score or don’t have a property to use it as collateral. Also, if your income isn’t steady, prepare for a rejection. Getting financing for a new business with a bank is also impossible. The lender can give you a loan only against tangible things you already have. Banks don’t want to take the risk of you not repaying the money you borrow. Their tough requirements make people go around in a circle without a chance to win the bank’s trust.
The good news is that there is a solid alternative to inaccessible bank loans. More and more people in Kenya consider savings and credit cooperative societies as a reliable financing option. Unlike banks, SACCOs are not-for-profit organizations that promote financial interests of the members.
SACCOs have a different financial philosophy. The society’s goal is to pool members’ savings and, in turn, give them access to credits at low-interest rates. While in a bank only a shareholder gets a profit, in SACCO every member wins.
The membership enables you to get dividends based on your shareholding percentage. You can also open a savings account that gives access to a loan facility. Savings and credit cooperative societies in Kenya offer different benefits and rates. It is crucial to do research before you enrol and open a savings account with the society. Ensure the SACCO of your choice offers the best set of benefits.
How does MOMBO SACCO differ from other savings and credit cooperative societies in Kenya? Most SACCOs offer only the dividend stream of income for its members. You get dividends according to the number of shares you bought. As you can see, it’s a great opportunity for investors. If you aren’t an investor, you still benefit a lot. Open a savings account and after a while, access a credit facility worth 2 or 3 times your savings. So your savings actually act as ‘collateral’.
The MOMBO SACCO goes much further. It is the only savings and credit cooperative in Kenya that offers interest on savings (6%). Unlike other SACCOs, MOMBO offers 2 streams of income: dividends and interest on savings. What is more, the volume of credit you can get is not two-fold or three-fold but 5-fold what you have saved. The interest will be as low as 12% (most banks give away loans at 14% and higher).
How to open a savings account with MOMBO?
Enrollment with MOMBO SACCO is easy through its MOMBO App. Upon enrolment, you will need to buy shares worth KES 10,000 and pay the entrance fee of KES 2,000. Then we will open a savings account for you and you can start saving immediately. The minimal monthly instalment is KES 3,000. With the App You can adjust the schedule of instalments according to your payday.
How to take a loan with MOMBO SACCO?
The access to the credit facility opens after 3 months of saving with MOMBO SACCO. Or you can wait until your savings reach the desired threshold (one/fifth you need to get in the loan). The loan provided can be up to 5 times your savings. The volume depends on how fast you need the money and the duration of repayment. Loans for up to 48 months are available for different needs. You can rely on us in both emergency situations and your lifestyle purposes. One savings account at MOMBO SACCO is an all-purpose saving facility you need to get financial support for your key life events.