Page 19 - Ramco JO SACCOStar _Vol 50.indd
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SACCO LEADERS CONVENTION
Conduct INTEGRITY and due
DILIGENCE in IMPLEMENTING
SYSTEMS, SACCOS TOLD
This, he said, means SACCOs cannot business. Systems have to be fit for
attract membership leading to purpose,” he said.
stagnation, urging SACCOs to place
ICTs in strategic place, aligning He urged SACCOs to migrate to better
technology to the business. systems.
“These challenges significantly affect “Some of the large SACCOs will go
compliance but we note that there acquire systems which are essentially
is a lot of resilience in our SACCOs not fit for purpose and they are trying
and before our customers run out of to modify. That is dangerous from a
patience, we better do something,” Mr security perspective because the system
Njuguna said. was not designed to be a banking
system.”
SASRA Supervision Manager Peter Njuguna Changing member preferences,
speaks on disruption in the regulatory To overcome these challenges,
environment increased competition from Njuguna said, SACCOs are
progressively investing in human
By Ngumbo Njoroge commercial banks, the advent of resources and upgrading employee
skills.
Savings and Credit Co-operatives digital technology and a revolution
need to conduct due diligence He called for increased collaboration
when implementing new in financial technology were cited as among small SACCOs who may not
systems to rid themselves of losses have the finances to invest in systems
occasioned by cybercrime, the SACCO changes affecting the SACCO industry, and technical capacity.
Societies Regulatory Authority has
said. with Njuguna noting that Deposit- “Software and hardware are services
that can be leased to technology
According to Peter Njuguna, SASRA’s Taking SACCOs are struggling to experts, even big corporations are
Supervision Manager, SACCOs doing it. SACCOs only need to examine
engaging system implementors respond in a timely, efficient and cost- whether such a system is suitable for
without conducting due diligence their needs while also managing the
are at risk of losing data and finances effective manner. risks.”
when compromised.
To survive disruption, he said SACCOs Titus Karanja, Managing Director at
“As a regulator we have noted that need systems of good and strong Fintech Frontiers, said SACCOs lacking
some SACCOs are not conducting governance as well as use data the technical and financial capacity
due diligence when engaging service analytics to develop member centric should consider mergers to leverage
providers only to suffer attacks after strategy. on economies of scale.
few weeks,” Njuguna said.
In addition, the Supervision Manager According to the SACCO Annual
Speaking on regulation and noted that there is need for adequate Supervision Report, Societies have
compliance by SACCOs in a global risk management and greater strategic partnered with commercial banks and
changing environment at the 5th collaborations between Deposit- telecommunications service providers
Annual SACCO Leaders Conference, Taking SACCOs and Fintechs. to offer ATM services, mobile money
he said technology associated risks wallet services and agency banking.
are increasing because of limited “To invest in appropriate tools for data
technical capacity and funding. analytics, you have to understand what
it is. You need to have appropriate
capacity at staff and board level.”
He added that SACCOs are facing
capacity challenges in technology to
address member needs and regulatory
requirements.
“Most of the systems you find in SACCOs
today are not core banking systems
yet DT SACCOs are offering banking
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