Page 31 - Issue 48_press_efile

POLICY AND REGULATIONS

capitalized are now lending to small into the national payment system as SASRA CEO Mr. John Mwaka
SACCOs,” said Mr. George Ototo KUSCCO participants by CBK.
Group Managing Director. SACCOs mainly Deposits Taking SACCOs
Participants comprise of the Central regulated by SASRA.
He said under the fund, SACCOs enjoy Bank of Kenya, the Government,
various products such as Kilimo loan, Commercial Banks, Financial Institutions Mwaka noted that over 70 per cent
Green-energy, SACCO compliance and Payment System Providers. National of depositors especially those at the
advance and savings, the instant Payments Systems in Kenya are bottom of the pyramid, and in the retail
premium loan, KUSCCO Jungu Kuu classified into two categories; Large market borrow money from SACCOs
loan, KUSCCO express loan, Vijana Value (Wholesale) and Low Value (Retail)
Sasa, Vijanaa loan and KUSASA KUSCCO Payment Systems. The classification is President Uhuru noted that the Co-
accounts. based on the throughput in terms of operative Movement in Kenya features
values and volumes processed. over 23,000 registered Co-operative
SACCO Societies Regulatory Authority Societies and commands a membership
(SASRA) Chief Executive Officer John “The establishment of the CLF will of over 14 million people.
Mwaka in an interview states that the require amendments to the SACCO
fund will be established soon following Societies Act 2008, the legislation that The establishment of the
the President’s directive. governs all SACCOs,” adds Mwaka. CLF, Mwaka observes, is a
mechanism that will enable
“In the recent past, we engaged a Once the fund is established it will SACCOs to be admitted
consultant to compare our case and enable SACCOs to pay more than sh1 into the national payment
where the CLF model has worked in the million in branded cheques and not co- system administered
world. The consultant has managed to branded cheques. by the CBK under the
compile a report and currently, we have National Payment Act.
a team of senior managers both drawn Key benefits include real-time funds
from SASRA and CBK who are studying transfer, efficient funds management
and analysing the report,” says Mr and allow large value transfers between
Mwaka.

Once the team is through with the
process it will advise accordingly on the
next step to be undertaken.

Kenya’s subsector regulatory model,
Mwaka said, borrows heavily from
Canada, United States of America and
Brazil where SACCOs have autonomous
bodies that supervise them unlike in
Europe where the Credit Unions are
managed by respective Central Banks.

The establishment of the CLF, Mwaka
observes, is a mechanism that will
enable SACCOs to be admitted into the
National Payment System administered
by the CBK under the National Payment
Act.

SACCOs traditionally do not offer certain
products such as cheque books, Real
Time Gross Settlement (RTGS) and
Electronic Funds Transfers (EFTs).

Once the CLF is established, Mwaka
notes SACCOs will be recognized

29| SACCO Star Magazine