20 Reasons Why Saccos Are The Best Vehicles For Accessing Credit For Major Investments
By Steve Biko Wafula / Published March 6, 2023 | 10:14 am
SACCOs are the best vehicle for accessing credit for major investments and creating genuine wealth due to their affordable credit facilities, flexible lending terms, personalized approach to lending, and community-driven focus on financial empowerment and literacy.
Having a SACCO account in Kenya is essential as it provides members with affordable credit facilities, encourages a savings culture, provides convenient access to financial services, empowers members, and offers various benefits.
SACCOs have become a critical component of Kenya's financial sector and have played a vital role in promoting financial inclusion, reducing poverty, and stimulating economic growth.
In Kenya, Savings and Credit Cooperative Organizations (SACCOs) have become increasingly popular over the years. SACCOs are member-owned financial institutions that provide affordable credit facilities and encourage members to save regularly.
Here are five reasons why it is essential to have a SACCO account in Kenya;
- Access to affordable credit facilities: SACCOs offer loans to their members at a relatively lower interest rate compared to commercial banks. This feature enables SACCO members to access affordable credit to meet their financial needs without being subjected to high-interest rates, which can lead to financial constraints.
- Encourages savings culture: SACCOs encourage a savings culture by providing a safe and convenient platform for members to save their money. Through regular savings, members can build a financial cushion that can be used to meet unforeseen expenses or to invest in income-generating activities.
- Convenient access to financial services: SACCOs provide members with easy access to financial services such as mobile banking, internet banking, and ATM services. These services are convenient, fast, and secure, making it easier for members to carry out financial transactions at any time and from anywhere.
- Empowerment of members: SACCOs empower their members by providing financial literacy training that enables them to make informed financial decisions. Through training, members can learn how to manage their finances better, make wise investments, and plan for their future financial needs.
- Provision of member benefits: SACCOs offer various benefits to their members, such as dividends on savings, access to insurance products, and financial advisory services. These benefits enable members to maximize their financial resources, enhance their financial security, and improve their standard of living.
In conclusion, having a SACCO account in Kenya is essential as it provides members with affordable credit facilities, encourages a savings culture, provides convenient access to financial services, empowers members, and offers various benefits.
SACCOs have become a critical component of Kenya’s financial sector and have played a vital role in promoting financial inclusion, reducing poverty, and stimulating economic growth.
Reasons why SACCOS are the best vehicle for accessing credit for major investments and creating genuine wealth;
SACCOs (Savings and Credit Cooperative Organizations) are member-owned financial cooperatives that offer savings and credit services to their members. Here are 20 reasons why SACCOs are the best vehicle for accessing credit for major investments and creating genuine wealth:
- SACCOs offer affordable credit facilities to their members. The interest rates charged on SACCO loans are generally lower than those offered by commercial banks.
- Members can borrow larger amounts of money from SACCOs than they could from other lenders, making SACCOs a better option for major investments.
- SACCOs provide a more flexible and personalized approach to lending than traditional banks. Members can negotiate loan terms to suit their specific needs.
- SACCOs offer members the opportunity to invest their savings in various investment vehicles, such as fixed deposits and treasury bills.
- Members can use their savings as collateral to secure loans from SACCOs. This arrangement is beneficial for members who do not have other collateral to offer.
- SACCOs are typically more willing to lend to members who have a lower credit score than commercial banks.
- Members who save regularly with a SACCO are more likely to be approved for loans when they need them, as SACCOs prioritize lending to their members.
- SACCOs offer longer repayment periods for loans than traditional banks, giving members more time to repay their loans.
- SACCOs offer a variety of loan products, including emergency loans, school fees loans, and business loans.
- SACCOs offer members the opportunity to save and invest in a community-driven financial institution, which fosters a sense of ownership and pride.
- SACCOs offer members access to financial education and literacy programs, empowering them to make informed financial decisions.
- SACCOs are more accessible to members in rural and underserved areas, as they have a more extensive branch network than commercial banks.
- SACCOs provide members with the opportunity to build credit history and improve their creditworthiness.
- SACCOs offer members a platform to pool their resources and invest in large-scale projects that they would not be able to undertake individually.
- SACCOs offer a more personalized and relationship-driven approach to lending, which can result in better loan terms for members.
- SACCOs are owned and governed by their members, ensuring that the institution’s interests align with those of the members.
- SACCOs offer members the opportunity to earn dividends on their savings, which can boost their returns on investment.
- SACCOs are more responsive to the needs of their members, as they have a better understanding of the local community and its needs.
- SACCOs have a vested interest in the financial well-being of their members, as their success is directly tied to the success of their members.
- SACCOs provide members with a secure and reliable platform to save and invest, promoting financial stability and security for their members.
In conclusion, SACCOs are the best vehicle for accessing credit for major investments and creating genuine wealth due to their affordable credit facilities, flexible lending terms, personalized approach to lending, and community-driven focus on financial empowerment and literacy.
SACCOs offer a unique opportunity for members to save, invest, and access credit in a way that is sustainable, community-focused, and empowering.
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