Deposits are the financial foundation of a SACCO. They provide an important source of funds that can support lending, investment and other activities while strengthening the institution’s liquidity.
However, increasing deposits is not simply a matter of telling members to save more. Members need a clear reason to keep more of their money with the SACCO, and the institution must make saving convenient, rewarding and relevant to their financial goals.
A SACCO that wants to grow deposits should therefore combine member education, targeted savings products, digital convenience, strong customer service and consistent engagement.
Here is a practical strategy that can help.
Understand why members are not saving more
Before launching a new deposit campaign, SACCO management should first establish why deposits are growing slowly.
Members may have limited disposable income. Others may already be saving through banks, mobile money platforms, investment groups or other SACCOs.
Some members may also feel that the SACCO’s savings products are not flexible enough or that they do not provide enough value.
Management should collect feedback through member surveys, meetings, customer service channels and account data.
The SACCO should identify which members are saving regularly, which have become inactive and which maintain very small balances.
This information can help management develop a deposit strategy based on actual member behaviour rather than assumptions.
Create savings products for specific goals
A single savings account may not meet every member’s needs.
Members are more likely to save when they have a specific objective.
A SACCO can therefore develop products around goals such as education, emergencies, housing, business expansion, retirement, holidays or asset acquisition.
For example, a member saving for school fees may prefer a product that encourages regular contributions and restricts unnecessary withdrawals.
A young professional may prefer a flexible savings account that can be accessed digitally.
The objective is to make saving purposeful rather than presenting it as a general financial obligation.
Make saving automatic
One of the most effective ways to increase deposits is to make saving automatic.
Members can be encouraged to set regular savings instructions so that money is transferred into their SACCO accounts at predetermined intervals.
Where payroll arrangements allow it, employers can facilitate regular deductions for members.
Automatic savings reduce the temptation to spend money first and save whatever remains.
The SACCO can also encourage members to increase their contributions whenever their income rises.
Encourage members to save immediately after receiving income
Timing matters.
Many people spend first and try to save what remains at the end of the month. Often, little is left.
SACCOs can educate members to reverse this approach by treating savings as one of their first financial commitments.
Members can be encouraged to set a savings target and transfer the amount immediately after receiving their salary or business income.
This simple behavioural change can gradually increase account balances.
Use digital channels to make saving easier
A member should not have to visit a branch every time they want to save.
SACCOs should make deposits easy through available digital channels, including mobile services and online platforms.
The simpler the process, the easier it becomes for members to develop a regular savings habit.
Digital platforms can also provide balance information, transaction notifications and savings progress updates.
The SACCO should ensure its digital channels are reliable, secure and easy to use.
Give members a reason to increase their balances
Members need to understand the value of keeping money with the SACCO.
This does not necessarily mean offering unsustainably high returns.
The SACCO can explain how savings support access to credit, financial security, investment opportunities and other member benefits.
Where particular savings products have specific returns, terms or benefits, these should be communicated clearly.
Members should also understand the difference between savings and share capital and how each serves their interests within the SACCO.
Reward consistent saving behaviour
SACCOs can develop programmes that encourage members to save consistently.
For example, the institution can recognise members who maintain regular contributions or reach defined savings milestones.
The rewards do not always have to be monetary. Financial education sessions, recognition at member events or access to selected programmes can also encourage engagement.
Any incentive programme should be financially sustainable and clearly structured.
The aim is to create long-term saving habits rather than encourage members to deposit money temporarily just to qualify for a promotion.
Segment members and personalise the approach
A SACCO should not communicate with all members in exactly the same way.
Young members may respond better to digital communication and goal-based savings products. Families may be interested in education or emergency savings, while business owners may need products that help them separate business and personal finances.
The SACCO can use member data to understand these different groups and develop appropriate communication.
Personalised engagement can make members feel that the institution understands their financial circumstances.
Reactivate dormant accounts
Dormant accounts represent an opportunity for deposit growth.
Instead of focusing entirely on recruiting new members, SACCOs should identify members whose accounts have become inactive.
Management can contact these members to understand why they stopped saving or using the SACCO.
Some may have changed jobs, relocated, experienced financial difficulties or simply forgotten about their accounts.
A structured reactivation programme can encourage eligible members to resume saving.
However, the SACCO should focus on understanding the reason for inactivity rather than simply sending promotional messages.
Improve customer service
Members are unlikely to keep significant deposits with an institution they do not trust.
Poor customer service can therefore undermine deposit mobilisation.
Long queues, unanswered calls, delayed responses, unclear charges and unresolved complaints can discourage members from increasing their balances.
SACCOs should establish clear service standards and regularly monitor whether they are being met.
Every interaction with a member is an opportunity to strengthen confidence in the institution.
Build trust through transparency
Members need confidence that their money is being managed responsibly.
SACCO management should communicate clearly about the institution’s performance, products, policies and major developments.
Financial information should be presented in a way members can understand.
Where there are changes to savings terms, charges or procedures, members should receive timely communication.
Transparency can strengthen the relationship between members and the SACCO and encourage them to consolidate more of their financial activities with the institution.
Connect deposits to useful financial services
Savings should not exist in isolation.
A SACCO can demonstrate the wider value of saving by connecting deposits to members’ financial goals.
For example, regular savings may help members build the financial discipline required to qualify for certain loans or achieve investment objectives, subject to the SACCO’s policies.
This creates a stronger relationship between saving and other services.
However, members should not be encouraged to save merely to borrow. The SACCO should promote responsible financial planning and borrowing based on genuine needs and repayment ability.
Use financial education to change saving habits
Some members may have the ability to save but lack a structured financial plan.
Financial education can help members understand budgeting, emergency funds, debt management and long-term wealth building.
SACCOs can organise financial literacy sessions through branches, member meetings, webinars and digital platforms.
The lessons should be practical.
Members should leave with clear actions, such as setting a monthly savings target, reducing unnecessary expenses or establishing an emergency fund.
When members become more financially disciplined, the SACCO can benefit from stronger and more consistent deposits.
Make deposit mobilisation everyone’s responsibility
Deposit growth should not be left entirely to the marketing department.
Board members, management, branch staff, customer service teams and other employees interact with members and can help identify savings opportunities.
However, staff should not pressure members into depositing money they cannot afford to save.
The focus should be on understanding members’ needs and recommending suitable products.
Clear performance indicators can help management track progress without encouraging unhealthy sales practices.
Monitor the right numbers
A SACCO cannot improve what it does not measure.
Management should regularly monitor deposit growth, average member balances, frequency of deposits, dormant accounts, withdrawals and the number of members making regular contributions.
It should also examine which savings products are growing and which are losing members.
If deposits increase for a few months and then decline, management should investigate the reason.
The data can help the SACCO identify whether its strategy is actually changing member behaviour.
Avoid unsustainable deposit campaigns
A SACCO should be careful about using expensive promotions simply to increase deposits temporarily.
A campaign that attracts money for a short period but becomes too costly to maintain may not provide lasting value.
The institution should focus on building sustainable savings habits.
The strongest deposit growth comes from members who continue saving month after month, not from temporary deposits made solely to take advantage of a promotion.
Make deposit growth part of the SACCO’s long-term strategy
Increasing deposits should be treated as a long-term strategic objective.
The board and management should establish realistic targets and determine which products, member groups and channels will help achieve them.
The strategy should also consider liquidity management. Rapid deposit growth must be managed carefully so that the SACCO can meet withdrawal needs and deploy funds responsibly.
A growing deposit base is valuable only when it is supported by sound financial management.
Author: Andrew Walyaula
Andrew Walyaula is a seasoned multimedia journalist. Email: [email protected]
