SACCOs in Kenya: The Benefits of Borrowing
August 14, 2018 | BY MOMBO | Views: 113
Besides the best saving plans they offer, registered SACCOs in Kenya offer plenty of borrowing opportunities too. In this article we’re going to cover all the benefits of borrowing from SACCOs in Kenya and how to get the most from your money with Mombo!
What are SACCOs?In case you didn’t already know, SACCO stands for savings and credit cooperative organisation. So, you can already tell that they’re all about best savings plans, savings accounts and finance. But in this article, we’re going to focus on the credit side of SACCOs in Kenya. SACCO societies are organisations of savers, investors and finance professionals, so you often have a lot of opportunity to make the most of your money. From higher interest rates on your savings, to lower fees compared to what the traditional banks charge.
The Benefits of FOSA and BOSAThere are 2 types of SACCOs in Kenya, both with unique benefits. FOSA stands for Front Office Services Activity. It basically means that they offer similar products to the traditional banks in Kenya, and you can access your savings over the counter. You can withdraw from your SACCO account when you like, but there may be small fees and reduced interest rates as a result. These aren’t the best saving plan if you want to get the most interest from your savings. FOSAs are regulated by SASRA (SACCO Societies Regulatory Authority) while BOSAs are not.
Benefits of a FOSA SACCO:
- You can withdraw money when you like, as you would a bank savings account.
- As a member of the SACCO you may have access to their loans too.
- Clearing house process also allows you to process your salary and cheques through the FOSA.
Benefits of a BOSA SACCO:
- Higher interest rates compared to banks and FOSA SACCOs on your savings.
- Money tied into the BOSA can be used to get you a higher loan – 5x your savings in the case of Mombo!
- Solely focused on your savings and loans – a BOSA SACCO is dedicated to managing these finances alone.
The Benefits of Borrowing from a SACCO
Here are the key benefits of borrowing from a registered SACCO in Kenya. Can your bank offer you these features?
- Better credit facilities and more flexibility than the banks.
- A much smaller chance you’ll be declined a loan from a SACCO you’re part of, compared to traditional lenders!
- You may be entitled to dividends as a key member, depending on the SACCO.
- It’s much easier to save large amounts of money without the temptation to spend it – especially with a BOSA.
Extra benefits from Mombo:
- A completely digital process – from signing up to applying for loans to repaying them.
- Access and monitor your SACCO activities from anywhere via smartphone.
- Access to Mombo iCapital for larger loans over a longer term
- Dedicated support from 24/7 customer help via our innovative Mombo app.
- Life insurance guarantee – if you pass away while holding savings with Mombo, your loved ones will receive twice the amount you saved.