Effective savings mobilization strategies for Saccos

Savings and Credit Co-operative Societies (Saccos) play a crucial role in promoting savings, providing credit, and improving members’ living standards. According to Sacco by-laws, the main objectives are to encourage savings, create a source of funds for loans, and offer financial benefits to members.
Ensuring Savings Protection
To effectively mobilize savings, Saccos must prioritize the safety and value of members’ deposits:
- Protecting the Real Value of Savings: Saccos need to ensure that the purchasing power of saved money is maintained over time. For instance, if a member deposits Kshs. 1,000 today and inflation is 10%, the Sacco should return at least Kshs. 1,000 to preserve the value of the savings.
- Protecting the Nominal Value of Shares: Saccos must be financially strong enough to return 100% of the value of a member’s shares upon request. This means that the value of the Sacco’s assets should be equal to or exceed the value of the shares held by members.
Savings Mobilization Strategies for Saccos
To successfully attract and retain savings, Saccos should implement the following strategies:
- Competitive Interest Rates: Offer interest rates on savings that are at least comparable to those offered by competitors to avoid hidden costs and attract members.
- Professional Image: Maintain a professional appearance in staff and facilities to build trust and confidence in the safety of savings.
- Diversify Products and Services: Provide a range of services similar to competitors to meet all members’ savings needs in one place, reducing the need to use multiple institutions.
- Separate Savings from Lending Services: Ensure that savings services are not compromised for the sake of offering cheaper loans. Both services should benefit members.
- Exclusively Member Savings: Only accept savings from members to reinforce the cooperative principle of serving only those who are part of the Sacco.
- Manage Large Accounts Cautiously: Handle large savings accounts carefully to prevent withdrawals for better interest rates elsewhere. Consider safe investments and match investment maturities to ensure adequate returns.
Savings Mobilization Products
Saccos can mobilize savings through various financial products, including:
- Passbook Savings Accounts
- Fixed Deposit Accounts
- Children’s Savings Accounts
- Student Savings Accounts
- Medical Savings Accounts
- Christmas and Holiday Accounts
- School Fees Savings Accounts
- Burial Savings Accounts
- Retirement Deposit Accounts
Financial Products and Services for Members
In return for their savings, members can access a range of financial products and services such as:
- Mortgage Loans
- Vehicle, Motorbike, and Bicycle Loans
- Small Business Loans
- Home Improvement Loans
- Agricultural Loans
- Advances/Overdrafts
- Hire Purchase Loans
- Credit Cards
- Money Orders
- Payroll Deductions
- Safe Custody Services
- Share Transactions
- ATMs
- Bill Payment Services
- Business Advisory Services