PROTECTING BORROWERS FROM MISSPENDING BORROWED FUNDS IN KENYA, NAIROBI, KENYA

PROTECTING BORROWERS FROM MISSPENDING BORROWED FUNDS IN KENYA, NAIROBI, KENYA

November 16, 2011

Posted by PROTECTING BORROWERS FROM MISSPENDING BORROWED FUNDS IN KENYA, NAIROBI, KENYA

 There are many reasons why anyone could misuse funds or just come across unavoidable circumstances that will eventually lead to the failures of their projects .The main and foremost reason in this case is usually lack of skills on how to handle money in the project owners. This lack of the skills leads to the misappropriation of the funds so that every section of the procedures in the construction or implementation of the project is not included in the financial plan so that in end, there arises unexpected expenses that consume up the funds leading to the shortage of funds and hence, problems in completing

the construction or the implementation of the project. times, it isn’t the lack of monetary skills in the People who are handling the project that cause the failure of these projects, it is the human weaknesses in them .The misuse of the funds by the project staff due carelessness, graft and much more on the list of human weaknesses that we know, all combined can cause this failures.

There have been reports of farmers who have misused their tea or coffee bonus payments or even loans from their Sacco’s of Banks. These farmers mostly spend their funds on entertaining themselves .Not even a single cent goes towards the intend projects .So because of such weaknesses and much more,They end up consuming the money instead of setting up whatever projects they had in their minds. They have very wise ideas but because of these weaknesses, they are unable to achieve their dreams.

This problem has been existing in this country since the days of independence .It is because of this problem that we thought it wise to ask some of our co-operative management experts on what measures they had taken as the country’s’ experts in the field towards helping people with these problems.

Our expert is the director of the Jamena Agencies in Kericho town and their offices are situated on the Posta Plaza building along the Kisumu to Nairobi Highway. The director gave us some advice concerning the issue.

The experts advise on how to help people who are borrowing loans from Sacco’s, banks or any other monetary organizations to utilize their loan funds well was this; the first and foremost thing is to get the entire Kenyan Population trained on how to handle money .This will equip every body in the country, old and young with the necessary skills in the use of their money. They will then know how to spend each and every coin that they earn in their daily lives and thus save them from the mistakes that they find themselves in due to their ignorance.

The second solution to the problem is to have the Sacco’s or banks or whichever monetary organizations that they might be involved in the transaction with do what we call “Asset Financing”.

With Asset financing, the borrowers aren’t given the cash directly in the hand, instead, they are provided with whatever services or assets that they all looking for by the banks or monetary institutions that will have gone to for the loans and then they are left only to manage the projects. The Monetary institutions will build all the assets that will be needed in order to form whatever kind of project they will be wanting  and then when the projects will be complete ,they will then handover the projects to the owners who will then be expected to be responsible for the everyday operations of the project.

This is considered to be the most effective way of saving the borrowers from falling into a misfortune due to their ignorance in the loan spending management .It is a shortcut and very easy way of helping the borrowers to achieve their dreams when go for help from money lenders.

The above mentioned techniques are considered as the best alternative to giving the borrowers hard cash which they can easily spend.

john ambuli. Posted In: SACCOS 

THE ROUTE K64 SACCO OF KERICHO DISTRICT PLANS TO BECOME A MICRO FINANCE INSTITUTION, NAIROBI, KENYA

THE ROUTE K64 SACCO OF KERICHO DISTRICT PLANS TO BECOME A MICRO FINANCE INSTITUTION, NAIROBI, KENYA

The Route K64 Sacco intends to transform itself in to a micro-finance institution. According to the Sacco members that we interviewed in the last week of the month of October, the year two thousand and eleven, the society’s’ to officials held a meeting in Kapsoit Township, a small town on the outskirts of kericho town.

The sources ,who are very reliable, said that the staff members who met here  were expected to discus on how they could get the all the resources and information ,manpower and how they could get all the assistance to enable the Sacco to transform itself well and smoothly up to its’ every day operations.

The Society is only eight months old but is already trying on big things .The staff member that we talked to told us that the society’s’ total assets plus the total savings and earnings for the period that it has existed amount only up to four million and the Sacco’s senior staff have seen it wise to transform the society in to a microfinance institution as a development move.

We weren’t able to access the proceedings of the meeting .All our efforts to meet some of the members who took part in the meeting or to get in contact with their headquarters weren’t successful but we hope to carry the reports about this meeting in our next issue of this magazine.

The route K64 Sacco is a transport Sacco in Kericho District .The society operates it transport business on the kericho to Eldoret route and back

FOUNTAIN PRIMARY SCHOOL IN KERICHO TOWN OFFICIALLY DECLRED OPEN

FOUNTAIN PRIMARY SCHOOL IN KERICHO TOWN OFFICIALLY DECLRED OPEN




Fountain primary school in kericho town, was declared officially open by the director of education in the ministry of education, Professor George kodia .The school had about four years earlier been enrolling students but it hadn’t been officially declared opened.



The ceremonies were held in the school compound on the eleventh date of the month of October this year .Activity started at eleven o’clock in the morning up to two o’clock in the afternoon.



The guest of honor who to resided over the function was supposed to be the ministry’s’ permanent secretary ,Mr. James Ole Kiyiapi,but due to untold circumstances, he wasn’t able to attend, instead he was represented by his director of education in the same ministry.



The school is among the high class group of schools in the town, Kericho primary school, ACK Primary are just but a few among the group.

LIZ AMPOFO AND SISTER

LIZ AMPOFOS PHOTO OF JOHN AMBULI

SUSPICION OF GRAT IN THE KERICHO MUSLIM SECONDARY SCHOOL.

SUSPICION OF GRAT IN THE KERICHO MUSLIM SECONDARY SCHOOL.

The Muslim Secondary School in Kericho, Kenya, is already being reported with the same news that has faced many other government or public institutions in the country. To make things worse is the fact that it is a religious institution, where you wouldn’t expect reports of graft and the general embezzlement of the public funds.

A member of the staff in the administration of the mosque that is situated at the Kenya co-operative creameries Depot in Kericho town whispered to us that there has not been a clear circumstances on how the school funds are spend .The member said that the school is sponsored by the Islamic world bank but there have been no clear reports on how the aid funds from the bank are spend ,all that he hears about are reports of the expenditure  of the funds but the school assets are moving or growing in any way, they are just where they were on the grand opening day of the school.

This was whispered to us by the mosques Madrasa teacher who has since then been transferred to Kendu Bay  to help with the training of young children in to Islam hood in Kendu bay.

The Madrasa teacher told the education newspaper to ask the entire Muslim community in the country to take action about this suspicion and have the schools ledgers and other documents of accounts scrutinized for any false dealings. The teacher also wanted the Muslim community to have schools administration monitored closely for any unbecoming behaviors and graft. He complaint bitterly on slowly growth speed of the school despite the Funding from the bank and the expected expertise from the schools administration staff.

He also told us to ask the Muslim community in Kericho town to give the unused parts of land that belongs to the religion to the Faithfull’s of the religion in the town so that they can use it for development purposes instead of the land lying there idly like that.

NDEGE CHAI SACCO

NDEGE CHAI SACCO

Ndege chai Sacco has it origins in the James Finlay Company, the giant tea and flower producing company in Kericho. The Sacco was formed before the company changed its’ name from the African Highlands Produce company to what it is called currently .Today, the Sacco is the biggest in the district.

Membership to the Sacco is open to everyone at a fee of only one hundred shillings and those who are intending to join the Sacco shouldn’t be members of any other Sacco’s elsewhere that carry out the same kinds of business and they should carry with them a copy of their ID cards.

There products include Savings accounts which include personal accounts ,medical accounts, holiday accounts, group accounts ,fixed deposit accounts ,retirement savings account, children’s accounts ,Christmas accounts ,joint accounts, and Akiba kuu accounts .All these savings accounts are not charged ledger fees .

They also give out a variety of loans to their members .They include the normal loans that last for a total of forty eight months with an interest rate of 14% p.a ,additional loan that lasts for the same period with the same interest rates ,emergency loan that lasts for twelve months with an interest rate of 14% P.a ,housing shares and investment loan that lasts up to thirty months with an interest of up to 10% pa ,they give their customers a salary advance loan that lasts for only one month with an interest rate of 8% p.a ,they also give their customers a special  advance that has an interest rate of ten percent per  month, and finally ,they have the jipange loan that last for six months with an interest rate of 3% per month with a maximum amount allowed of two hundred thousand shillings and a minimum amount of ten thousand shillings .

All these loans are formulated on a reducing balance and every loanee meets 1.2% the insurance of cost of his or her loan .The normal and additional loans are paid within thirty days, emergency loans within five days from the day of the receipt of the loan forms provided the applications are filled correctly and all relevant documents attached. The |FOSA advances are processed within fifteen to thirty minutes provided that all requirements are fully met.  

The Sacco’s’ services to its’ members include what they call safe custody  where they charge two hundred shillings per annum ,Bankers checks where they retail the co-operative banks’  bankers’ checks at four hundred and forty shillings and society Bankers’ checks at one hundred shillings .They also have a service that they call the company bill. They pay company bill at a fee of only fifty Kenya shillings.

The Sacco is connected to the co-operative bank network of Sacco link ATMs’. Members can access their cash at any co-op bank ATM country wide and any VISA branded ATM or merchant outlets like supermarkets .They also offer M-Pesa services which apart from sending and receiving money through all M-Pesa outlets, the members can also deposit cash to their FOSA Accounts, make loan repayments and savings using the pay bill option of M-PESA. Using the Sacco’s’ business number  637 637 .It is a simple process of indicating your membership number and the account you are depositing to –whether shares ,loans or FOSA and the account is upgraded automatically .

The Sacco also has the SMS alert services for its’ member which give alerts to each credit to the  FOSA accounts .Guarantors of loanees will also get who default will also get alerts immediately a loanee starts defaulting. Balance enquiries are also possible via SMS by simply texting the word ndegechaisacco to 8004.

The Sacco also has M-Banking services for its’ members .The members are able to make withdrawals from their own FOSA accounts to M-pesa anywhere /anytime by simply dialing *245 harsh and follow very simple steps provided.

On shares and deposits, the Sacco’s Members earn dividends on shares and interest on deposits .This is calculated on a pro-rata formula. The members are also eligible to withdraw loan amounts equal to three times their shares and deposits. The Sacco is committed to provide the best services possible to it’s’ members. They pledge that they will always maintain the back office (BOSA) open from 8.30 am to 5.00pm during the week days and 8.30 to 1.00pm on Saturdays. They also pledge to maintain Front Office (FOSA) open from 8.30 am to 4.00pm on weekdays and from 8.30 am to 1.00pm on Saturdays. They pledge to establish customer care counters at which all enquiries will be attended to; and the necessary documents availed. They also intend to offer excellent services with courtesy, respect, honesty, integrity and impartiality when dealing with membership matters .Customers will be served within fifteen minutes of their visits .All the customers concerns and any information provided will be treated with utmost confidentiality including your personal account details.

On complaint re-dressal, all the Sacco’s customers and general public are advised to lodge genuine complaints and suggestions trough the Sacco’s official contact addresses and phone numbers.

In the event of not being able to receive desired service or feedback from ndege chai office staff, customers can directly lodge their complaints with the chief executive officer, either via written mail, e-mail or phone for prompt resolution either in person or through their elected delegates