Investment

How Stima Sacco Moved From Humble Beginnings To A Financial Powerhouse

BY Soko Directory Team · July 2, 2024 01:07 pm

I listened to Dr. Gamaliel Hassan, the CEO of Stima Sacco speaking Stima Sacco, talking about the Sacco movement in Kenya and how Stima Sacco came to be such a giant in Kenya’s financial sector. The man has facts and points at his fingertips and from his interview, I was convinced that Kenya is headed in the right direction.

Stima Sacco is currently the largest Sacco in terms of asset base in Kenya and the region with over 200,000 members. The story started 50 years ago when a small group of ten visionaries embarked on a journey that would transform the financial landscape of the whole country.

This group, united by a common goal of financial empowerment, founded Stima Sacco, a savings and credit cooperative society that has grown from being just a society to a financial giant that is commanding billions of shillings in terms of members’ savings and investments.

“The dream of our founders has never died. We have kept the fire burning and Stima Sacco is still the best in the country. Our members have grown from 10 to over 200,000 and we are the largest in terms of asset base,” said Hassan.

In its infancy, Stima Sacco faced numerous challenges. With only ten members, the cooperative had limited resources and a modest pool of savings. However, what they lacked in financial capital, they made up for with a strong sense of community and trust. The founders understood that the success of their endeavor depended on the trust and commitment of each member. They diligently contributed to the cooperative, fostering a culture of mutual support and financial discipline.

As word spread about the benefits of joining Stima Sacco, membership began to grow. The cooperative’s commitment to transparency and member-centric services attracted more individuals who were eager to secure their financial futures. With an increasing number of members, Stima Sacco expanded its services, offering a wider range of savings and investment products.

The introduction of innovative financial products and services played a pivotal role in Stima Sacco’s growth. The cooperative embraced technology to streamline its operations and improve member experience. Online banking, mobile money services, and digital loan applications made it easier for members to access their accounts and conduct transactions from anywhere, at any time.

“Ever since, our financial performance has grown tremendously. For instance, for the fiscal year 2023, our records were strong, for not only ensured our sustainability but also enables us to reinvest in our members and communities. It is important to also note that our balance sheet grew by 10 percent from 53.8 billion shillings in 2022 to 59.15 billion shillings in 2023,” he said.

At the core of Stima Sacco’s success is its unwavering commitment to member empowerment. Unlike traditional banks, which prioritize profits, Stima Sacco focuses on the financial well-being of its members. Profits are reinvested into the cooperative, providing members with higher returns on their savings and more affordable loan rates.

Members have access to financial education programs, workshops, and personalized financial advice. These resources empower them to make informed decisions about their savings, investments, and loans. By prioritizing member education, Stima Sacco ensures that its members are not only financially secure but also knowledgeable about managing their finances.

Last year, Stima Sacco recorded a 21 percent growth in revenue to 8.96 billion shillings for the financial ending December 31, 2023, compared to 7.5 billion shillings the previous year. The Sacco asset base grew by 10 percent to 59.1 billion shillings from 53.8 billion shillings in the previous year. The loan book grew by 9.3 percent to 45.2 billion shillings from 41.3 billion shillings in 2022.

The Sacco members were also paid 485.5 million shillings from share capital compared to 395.7 million shillings paid out last year while earnings from interest will amount to 3.6 billion shillings from 3.2 billion shillings.

Over the years, Stima Sacco has made a significant impact on the community. By providing affordable loans, the cooperative has enabled members to start businesses, invest in education, and improve their quality of life. Small businesses have flourished, creating jobs and boosting the local economy. Families have been able to invest in education, leading to higher literacy rates and better job opportunities.

Stima Sacco’s commitment to social responsibility extends beyond its financial services. The cooperative actively participates in community development projects, supporting initiatives that promote education, healthcare, and environmental sustainability. These efforts have solidified Stima Sacco’s reputation as a pillar of the community, dedicated to fostering positive change.

As Stima Sacco celebrates its 50th anniversary, it stands as a testament to the power of cooperative spirit and community-driven growth. With over 200,000 members and a legacy of financial empowerment, the cooperative is poised for continued success. Looking ahead, Stima Sacco remains committed to innovation, member empowerment, and community development.

The journey of Stima Sacco is a remarkable example of how a small group of individuals, driven by a common vision, can create a lasting impact. From its humble beginnings with ten members, Stima Sacco has grown into a financial powerhouse, touching the lives of hundreds of thousands. As it continues to evolve and adapt to the changing financial landscape, Stima Sacco’s legacy of trust, empowerment, and positive change will undoubtedly endure for generations to come.

About Soko Directory Team

Soko Directory is a Financial and Markets digital portal that tracks brands, listed firms on the NSE, SMEs and trend setters in the markets eco-system. Find us on Facebook: facebook.com/SokoDirectory and on Twitter: twitter.com/SokoDirectory