Ukulima Sacco members held their 37th annual general meeting which was graced by the managing director of Co- operative Bank Gideon Muriuki among other guests.
Sacco chairman Philip Cherono said the society continued to post good results, despite many challenges in the operating environment. The total turnover increased to Sh960,912,181 from Sh798,396,268 realised in 2013, recording an increase of 20pc.
Interest income grew by 20pc to Sh858,649,558 from Sh713,834,920 in the year 2013 while the share capital increased by Sh102,149,085 to Sh268,043,596 from Sh165,894,511 registered in the previous year. This represents a 62pc growth which is attributed to the increase of institutional capital from Sh5,000 to Sh10,000.
However, since this was a book transfer, the Sacco did not experience any fresh capital injection. Member deposits also grew to Sh6,004,712,254 from Sh5,514,465,939 in 2013 representing a 9pc increase.
According to the chairman’s report, the total assets also increased to Sh8,294,183,624 from Sh7,321,315,578 as at December 31 2013 representing a growth of 11pc while the total loan portfolio increased by 9pc to Sh6,127,932,428 from Sh5,624,702,557 in 2013. The above results are well within the targets set out in the strategic plan 2012-2016.
The report further revealed that the society disbursed Bosa loans worth Sh3,018,957,300 during the year which was a drop of 7pc from Sh3,242,750,586 disbursed in 2013. Fosa disbursed loans worth Sh1,992,368,844 during the year, a growth of 2pc from Sh1, 945,232,300 disbursed during the year 2013 through Fosa.
Overly, the total loans disbursed were worth Sh5,011,326,147 during the year decline of 3pc from Sh5,187,982,886 disbursed during the year 2013. The society processed 25,021 loans applications during the year. This was a growth of 5pc from 23,896 applications in the year 2013. The board has analysed the factors contributing to the decline in lending and has put in place measures to change the situation. However the overall performance demonstrates an improvement and growth.
Owing to the good performance, the board of directors proposed the distribution of surplus as follows: - honorarium of Sh3,400,007 be paid to the board of directors, supervisory committee and branch delegates in office in 2014 as a token of appreciation for their good performance. It was also noted that the society was licensed as a Deposit Taking Sacco on December 19 2011 by the Sacco Societies Regulatory Authority and its licence has been renewed annually since then as regulated.
On the society’s strategic plan, almost all of the milestones that had been expected to be achieved by 2016 are already achieved. It is with a view to this that the board of directors seeks to bring forward the development of the 4th strategic plan for the period 2016 -2020. The plan is expected to inject fresh impetus in the society’s operations.
On front office activity, as at December 31 2014, the society had opened 29,065 accounts out of the total membership of 5,373. However, out of 29,065, Fosa accounts there are only 6,356 salaries accounts which form only 21pc of the total accounts. These members borrowed Fosa loans amounting Sh1.1b, and have made saving of Sh0.58billion.
The report further reveals that Fosa was able to make a surplus of Sh230 million during the year 2014. To enable society members transact with Fosa from all parts of the country, the society established ATM and M-Sacco services that enabled members to access their Fosa accounts at their convenience.
The society has so far registered 10,230 M-Sacco accounts and to take services closer to members, the society has opened five Fosa branches, and promises to use the strategy of opening branches to reach out to their members across the country.
Ukulima Sacco has entered into partnership with Family Bank in the provision of customer cheque books solution. The society is at the final stage of printing the cheque books to be ready for use, the chairman announced. “This is aimed at resolving the complaints that have arisen on limited access to funds through ATMs. This will enable account holders to transact using the cheque books,” he said.
Moreover, the Sacco intends to adopt the Flat Rate Interest System to increase members’ borrowing capacity. This change is geared at enhancing the borrowing capacity of members. At the same time, the society is working on a policy to introduce use of collateral as security on loaning to members. This, the chairman said, will reduce the burden left to guarantors whenever defaulting of loans occurs since it is a desired condition particularly when the society introduces the new micro-credit products.
On loan defaulters, with a view to curbing the increasing rate of default on loans, the Credit Reference Bureau was introduced via the Credit Reference Bureau Regulations 2008 operationalised in February 2009.
The bureaus are intended to share information on loan default. Defaulters reported to the bureaus are blacklisted thus cannot access loans for a period of five years upon their being reported. Ukulima Sacco has listed with one of the bureaus.
It is worth noting that Ukulima Sacco has made notable strides in the use of ICT to enhance efficiency and convenience in service delivery to our members, said Cherono. The society has successfully introduced mobile banking platform which has enabled members to access their funds through their mobile phones. This facility has now been expanded to allow members who channel their salaries through Fosa to apply and receive Mahitaji Loans, which are advances against their salaries.
Members can now apply for these loans through their phones and request for guarantors through the phones and upon approval the funds will be credited to their accounts without visiting the Fosa office. They can then withdraw using their phones.
The society has also introduced the use of bulk messaging as a means to enhance communication with our members and update them on developments within their Sacco.
Dividends are now processed at the touch of a button and disbursed into the members’ accounts from where they are able to withdraw from the comfort of their homes. Additionally, this efficiency has greatly helped reduce the number of complaints.
In summary, ICT has improved operational and administrative efficiency thus saving costs to the society while ensuring convenience and timeliness of service delivery to the members.
During the year under review, the society in line with its strategic objectives carried out customer satisfaction survey. According to the survey, overall satisfaction index for the society is 72pc though customers expected the society to perform at 87pc hence a satisfaction gap of 15pc.
Sacco chairman Philip Cherono said the society continued to post good results, despite many challenges in the operating environment. The total turnover increased to Sh960,912,181 from Sh798,396,268 realised in 2013, recording an increase of 20pc.
Interest income grew by 20pc to Sh858,649,558 from Sh713,834,920 in the year 2013 while the share capital increased by Sh102,149,085 to Sh268,043,596 from Sh165,894,511 registered in the previous year. This represents a 62pc growth which is attributed to the increase of institutional capital from Sh5,000 to Sh10,000.
However, since this was a book transfer, the Sacco did not experience any fresh capital injection. Member deposits also grew to Sh6,004,712,254 from Sh5,514,465,939 in 2013 representing a 9pc increase.
According to the chairman’s report, the total assets also increased to Sh8,294,183,624 from Sh7,321,315,578 as at December 31 2013 representing a growth of 11pc while the total loan portfolio increased by 9pc to Sh6,127,932,428 from Sh5,624,702,557 in 2013. The above results are well within the targets set out in the strategic plan 2012-2016.
The report further revealed that the society disbursed Bosa loans worth Sh3,018,957,300 during the year which was a drop of 7pc from Sh3,242,750,586 disbursed in 2013. Fosa disbursed loans worth Sh1,992,368,844 during the year, a growth of 2pc from Sh1, 945,232,300 disbursed during the year 2013 through Fosa.
Overly, the total loans disbursed were worth Sh5,011,326,147 during the year decline of 3pc from Sh5,187,982,886 disbursed during the year 2013. The society processed 25,021 loans applications during the year. This was a growth of 5pc from 23,896 applications in the year 2013. The board has analysed the factors contributing to the decline in lending and has put in place measures to change the situation. However the overall performance demonstrates an improvement and growth.
Owing to the good performance, the board of directors proposed the distribution of surplus as follows: - honorarium of Sh3,400,007 be paid to the board of directors, supervisory committee and branch delegates in office in 2014 as a token of appreciation for their good performance. It was also noted that the society was licensed as a Deposit Taking Sacco on December 19 2011 by the Sacco Societies Regulatory Authority and its licence has been renewed annually since then as regulated.
On the society’s strategic plan, almost all of the milestones that had been expected to be achieved by 2016 are already achieved. It is with a view to this that the board of directors seeks to bring forward the development of the 4th strategic plan for the period 2016 -2020. The plan is expected to inject fresh impetus in the society’s operations.
On front office activity, as at December 31 2014, the society had opened 29,065 accounts out of the total membership of 5,373. However, out of 29,065, Fosa accounts there are only 6,356 salaries accounts which form only 21pc of the total accounts. These members borrowed Fosa loans amounting Sh1.1b, and have made saving of Sh0.58billion.
The report further reveals that Fosa was able to make a surplus of Sh230 million during the year 2014. To enable society members transact with Fosa from all parts of the country, the society established ATM and M-Sacco services that enabled members to access their Fosa accounts at their convenience.
The society has so far registered 10,230 M-Sacco accounts and to take services closer to members, the society has opened five Fosa branches, and promises to use the strategy of opening branches to reach out to their members across the country.
Ukulima Sacco has entered into partnership with Family Bank in the provision of customer cheque books solution. The society is at the final stage of printing the cheque books to be ready for use, the chairman announced. “This is aimed at resolving the complaints that have arisen on limited access to funds through ATMs. This will enable account holders to transact using the cheque books,” he said.
Moreover, the Sacco intends to adopt the Flat Rate Interest System to increase members’ borrowing capacity. This change is geared at enhancing the borrowing capacity of members. At the same time, the society is working on a policy to introduce use of collateral as security on loaning to members. This, the chairman said, will reduce the burden left to guarantors whenever defaulting of loans occurs since it is a desired condition particularly when the society introduces the new micro-credit products.
On loan defaulters, with a view to curbing the increasing rate of default on loans, the Credit Reference Bureau was introduced via the Credit Reference Bureau Regulations 2008 operationalised in February 2009.
The bureaus are intended to share information on loan default. Defaulters reported to the bureaus are blacklisted thus cannot access loans for a period of five years upon their being reported. Ukulima Sacco has listed with one of the bureaus.
It is worth noting that Ukulima Sacco has made notable strides in the use of ICT to enhance efficiency and convenience in service delivery to our members, said Cherono. The society has successfully introduced mobile banking platform which has enabled members to access their funds through their mobile phones. This facility has now been expanded to allow members who channel their salaries through Fosa to apply and receive Mahitaji Loans, which are advances against their salaries.
Members can now apply for these loans through their phones and request for guarantors through the phones and upon approval the funds will be credited to their accounts without visiting the Fosa office. They can then withdraw using their phones.
The society has also introduced the use of bulk messaging as a means to enhance communication with our members and update them on developments within their Sacco.
Dividends are now processed at the touch of a button and disbursed into the members’ accounts from where they are able to withdraw from the comfort of their homes. Additionally, this efficiency has greatly helped reduce the number of complaints.
In summary, ICT has improved operational and administrative efficiency thus saving costs to the society while ensuring convenience and timeliness of service delivery to the members.
During the year under review, the society in line with its strategic objectives carried out customer satisfaction survey. According to the survey, overall satisfaction index for the society is 72pc though customers expected the society to perform at 87pc hence a satisfaction gap of 15pc.
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