CORPORATE SCENE
to business and equity growth , sustained member value creation and built-up capital by encouraging our members to re-invest their dividends into the share capital .
We have also expanded our offering to include insurance services offered by an insurance agency which is already operating profitably . We reduced the risk exposure by increasing the non-loan based income which was previously as high as 96 % to an average of 75- 80 % in the least three years .
We recruited and retained a team of highly specialized personnel who remain true and committed to the core values of the co-operative movement . We also offered commensurate remuneration and compensation to outstanding personnel in the last two years , despite the tough economic times .
Last year , saw the launch of shariah compliant products looking to increase our shareholder returns and grow the business with nontraditional products . In the same token , we started offering our members long-term mortgage facilities to secure homes or properties as optional investment and savings tools .
What challenges are you facing and how do you intend on overcoming these ?
Our biggest challenge in the last 2-3 years remains the pandemic which made us constantly adjust and pivot our business to the different omni-channels available . Due to the pandemic , we had to seek medical services and ensure our staff remained healthy and their risk of exposure minimized .
At the height of the pandemic , late 2020 and early 2021 , we pushed for a vaccination drive where over 90 % of our staff had received the full vaccination . With availability of the booster shots , we encouraged our staff to receive them as well to enable them stay healthy and in case of infection , reduce the mortality rate .
From a business point of view , the uncertainty and irregularity of business operations in the past two years has been another major challenge . The lockdowns and curfews put a strain in the banking operations as it did to our members and customers alike . We did find ways of mitigating this with robust online and mobile solutions .
I must also add that the introduction of a moratorium for institutional and individuals with high credit facilities and repayment helped manage our loan book . This was through the support of Sacco Societies Regulatory Authority ( SASRA )’ s guidance . Sectors such as the hospitality , transport , horticulture that were heavily affected fell under this moratorium . By the end of 2021 , we had been able to reduce from an initial amount of Kes . 1 billion to just under 100 million .
“ Stima Sacco is one of the leading and fastest growing and licensed DTS ( Deposit Taking Sacco ) with an asset base of KES . 46.5 billion , a loan book of KES . 36.4 billion , and membership of over 154,308 derived from all sectors of the Kenyan Economy .”
On Agency Banking what informed this and how much has it affected the Sacco ’ s Business Units in the respective branches in the country ?
Currently we have 9 branches which we identify as Strategic Business Units . However , if you look at the current membership numbers , we have representation across all counties in the country . How do we serve them accordingly and efficiently ?
This is the rationale behind the agency banking model . Beyond our current omni-channels in mobile and online , we have looked at providing agents to grow our footprint . Last year we piloted with 15 agents , in a product we ’ re calling “ Stima Sacco Mlangoni ”.
By the end of March 2022 , 180 agents had been recruited and enrolled in the different branches to support the strategic business units in exploiting opportunities of serving members at their comfort and convenience . It will expand the spread for the Sacco beyond the existing branches but also provide us with more visibility in non-traditional areas and markets .
We are also looking at opening 2 more branches before the end of 2022 to be able to provide the core services for those not able to access our agents , and also serve those members still inclined to visit a banking hall .
Stima Sacco was among the first to deploy the Shariah Compliant Products . Kindly share 3 key insights on this and how members can benefit from the range of products .
Stima Sacco was the first conventional Sacco in Kenya to provide shariah compliant products . This is no mean achievement as there have been a few financial institutions that have provided these products appealing to a niche market within a crowded financial sector .
From our research , we noted that shariah banking and financial products have become big even in developed markets such as the United Kingdom - which is a major financial hub in Europe . The differentiator is offering competitive products and providing a one-stop shop for all members .
These products are open to all our members - be they Muslim or non- Muslim . There are several products still under development and being improved upon . We have managed to grow this segment by over 100 % of the initial target for 2021 and are already on track to grow this further by between 300-400 % in the year 2022 .
The Sacco has been offering affordable housing mortgages under KMRC . How has it contributed to the Government ’ s agenda on affordable housing and the Big 4 ?
Stima Sacco was one of the founders of the Kenya Mortgage Refinance Company ( KMRC ) which came into existence in 2018 . The
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