Ollin Sacco’s Chief Executive Officer (CEO) John Gathige has urged Kenyans to save in a Sacco in order to get better loans and avoid loan sharks who normally take advantage of their dire situation.
Speaking during the Sacco’s 47th Annual General Meeting (AGM) which was held in Kutus Comprehensive Primary School grounds, Gathige stated that there are many unscrupulous money lenders who are not regulated by relevant authorities and which charge extremely high interest rates to exploit the borrowers.
He urged Kenyans to spend wisely their loans on the purposes for which they took it, adding that Kenyans should be very cautious about where they are getting loans from.
“Please know who you are borrowing from. Loan sharks are either individuals or organizations that are not registered, are not regulated and charge exorbitant interest rates. They are not under any regulations; therefore you cannot take them anywhere. There are others who are unscrupulous who want to take advantage of you,” he warned.
He decried the recent revelation by Infotrak that 78 per cent of Kenyans are living in serious financial distress as they struggle to make ends meet, with only 5 per cent living comfortable lives.
In central Kenya, the survey concluded that the worst hit populations are those between 18-26 years and above 55.
“A survey that we cannot ignore; it is true we are going through financial distress and tough economic times characterized by cash crunch and economic volatility. From a Finance perspective, I advise you to exercise prudence and give priority to needs and not wants. Buy what is absolutely necessary to cut on non-essentials,” Gathige advised.
According to the survey, which involved 1,500 respondents, Kenyans have devised coping mechanisms; including seeking additional employment or income sources at 45 per cent, cutting back on non-essential expenses at 41 per cent, taking loans at 18 per cent, and borrowing money from friends at 15 per cent, among other ways.
Co-operative Alliance of Kenya (CAK) CEO Daniel Marube concurred that the saving model is a better financial solution, pointing out that aimless borrowing has caused a lot of pain on majority of savers.
“Take a loan for a purpose to multiply; take it to develop not to compete. This has drained many loan takers who are left in tears when it comes to repayment,” he said.
Observing that the economy will not always be on the edge, he said Kenyans should save now despite the lean times.
READ ALSO:
“Save when the economy is tough. Save at this time when the economy is hard, because tomorrow will not be like today,” he said, implying that this will minimize future regrets.
He suggested that the Sacco founder members must be recognized, at the same time encouraging Saccos to focus more on making their services affordable.
“We need to remember where we have come from; the purpose of a Sacco is to provide access to affordable financial services to its members and not to give high dividends,” he said, asking members not to antagonize their directors as it will derail their purpose.
By Caroline Wangechi and Roy Hezron
Get more stories from our website: Sacco Review.
For comments and clarifications, write to: Saccoreview@
Kindly follow us via our social media pages on Facebook: Sacco Review Newspaper for timely updates
Stay ahead of the pack! Grab the latest Sacco Review newspaper!
