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Cooperative members protest tax on dividends


Members of the cooperative movement in Embu County have raised concern that increasing tax on member dividends could hurt SACCOs and the saving culture in the country. The co-operators urged the government to consider lowering tax rate on member dividends. They accused the government of multiple taxation that drains income thus killing the saving culture and contributes to poverty.

The income tax changes that took effect last month will see taxes on member dividends rise from five to 10 percent as well as withholding tax rate applicable to the dividends payable by a SACCO as an institution. KRA will be taking away 20 percent from the dividends of each SACCO member compared to the 10 percent it previously took.

Speaking during RAA Elites SACCO Society annual general meeting at St. Stephen ACK Kagaari church Runyenjes, they complained the government was punishing people for saving. Led by the SACCO’s vice chair Joel Mugane, they said the government had many other taxes levied from its citizen and that increasing tax on dividends was ill informed.
“The rate of youth enrolment in the SACCO is currently at 40 percent. We fear the rate of savings would drop if the taxes on dividends continue,” he said. Peter Njagi a member, said young people were not economically stable and that their dividends should not be overtaxed.
Loise Mwende, 23, said following massive training and appeal by leaders to form or enroll to existing SACCOs, youth had heeded to the call but they could stop saving following the taxation.

They said SACCOs were the only institutions that can lend to low income earners at low interests adding that overtaxing them would kill the sector.

Source: https://www.standardmedia.co.ke/business/article/2001314466/cooperative-members-protest-tax-on-dividends

 

SACCOs decry hurdles to affordable housing

Savings and credit co-operatives (SACCOs) have cited high interests rates, hidden charges in mortgage schemes and inadequate funding as stumbling blocks in the realization of the affordable housing dream.
Kenya Union of Savings and Credit Co-operatives Ltd (KUSCCO) national chairman George Magutu said although the SACCOs have the potential to contribute in the realization of the low housing agenda, there are several bottlenecks.
“In addition, the cost of property is too high for the low-middle income segment of the population. As a result, majority of informal sector borrowers are inclined towards incremental financing and self-construction loans, which are mainly provided by co-operative societies,” he said at Pride Inn Paradise Hotel in Mombasa during the 4th SACCO leaders’ convention.
Mr Magutu said a recent report on sectoral financing from the SACCO Societies Regulatory Authority (SASRA) revealed that from the over Sh300 billion borrowed by members in 2016, Sh118 billion (36 percent) was borrowed to fund housing projects.
“This is an indication of the key role that SACCOs have over the years played in the provision of housing to their members. With a membership of about 14 million people, the co-operative societies have great potential to bridge the existing housing gap,” he added.
The KUSCCO chairman said to help address the housing deficit in the country, his union had over 14,000 mortgage accounts financing long term mortgages for cooperators and SACCOs to put up houses and offices respectively.
“We therefore call upon the government to fast-track investments through facilitative tax regimes and build capacity in co-operatives.
"This will enable co-operatives not only produce raw materials in terms of farm produce, but also process and sell finished commodities to an ever growing market,” he said.


Source: https://www.nation.co.ke/news/SACCOs-decry-hurdles-to-affordable-housing/1056-4993334-f8d3s8z/index.html

 

CS: SACCO heads to be censured


Managers of cooperative societies who misuse members’ deposits will face the law, Interior Cabinet Secretary Fred Matiang’i has said. Dr Matiang’i’s warning comes on the back of recent claims of misappropriation of members’ savings at the troubled Ekeza SACCO. According to Matiang’i, SACCOs hold Sh230 billion in deposits, and have to be regulated properly so as to safeguard this money.
The Interior CS, who was speaking during a delegates meeting for Police SACCO, said the societies are prone to corruption just like government institutions are.
Safeguard deposits
“The President is serious about the fight against corruption. Whereas graft is deeply entrenched in State agencies, SACCOs are not immune to it,” Matiang’i said.
Matiang’i lauded the Police SACCO for helping its members get loans to purchase houses, an effort he said was a big boost for President Uhuru Kenyatta’s affordable housing plan.
According to the CS, Police SACCO has disbursed Sh24 billion so far as loans to its members. Most of it has gone into purchasing land and houses.
During the meeting, the SACCO approved a Sh220 million dividend to its members.
Matiang’i urged members to plough back half of that money into the SACCO so that it can be invested. He also told Police SACCO managers to keep offering cheap credit to members.
The SACCO leadership was represented by its chairman David Mategwa. Inspector General General of Police Joseph Boinnet lauded the SACCO for embracing ICT in its work.


Source: https://www.standardmedia.co.ke/article/2001315720/rogue-SACCOs-next-target-of-anti-graft-purge

 

Regulator warns of rise in cybersecurity threats


The National Cybersecurity Centre (NCC) detected over 3.8 million cyber threats in the first quarter of 2018-2019, indicating that Kenyans continue to be at a high risk of online attacks.
According to a new report by the Communications Authority of Kenya (CA), the threats represented an increase of 11.76 per cent from the last quarter of the year where 3.4 million threats were detected.
CA attributed the increased threats to enhanced cyber threat detection capabilities through deployment of additional sensors and increased resources towards cyber threat analysis
 “The cyber threats detected varied from denial-of-service (DoS) including botnet and brute-force attacks that led to denial of computer services and illegal access to computer systems; online impersonation via social media accounts and domain names; website attacks including defacement; malware including phishing attacks; online abuse including online fraud, hate speech, incitement to violence and fake news; and systems misconfiguration,” says the CA report.
The report revealed the susceptibility of Kenyans’ personal information and money in a country where financial institutions are eager to integrate digital technology to keep up with telcos which play an important role in facilitating transactions. Financial institutions lost Sh21 billion due to attacks on cybersecurity in 2017.
CA warned of a malware dubbed Emotet that accessed confidential information of Kenyans using online banking and payment systems. The malware, which attacked 11 Kenyan institutions, can cost up to $1 million (Sh102 million)per incident to resolve, according to the United States Computer Emergency Readiness Team.
Deposit taking SACCOs, which boasted a total assets portfolio of Sh442.3 billion in 2017, are also highly vulnerable when it comes to cybersecurity. This heightens the risk of loss of deposits by the more than 3.5 million Kenyans enrolled. Nearly 70 per cent of the 174 SACCOs countrywide have mobile applications for their customers.
The CA report paints a picture of increased threats in the form of malware, web application attacks, system misconfiguration and online impersonation. However, there is a marked decrease in online abuse.
Some regulations have been effected to protect Kenyans. For instance, the Sacco Societies Regulatory Authority released a set of guidelines which set minimum standards that SACCOs should adopt to develop effective cybersecurity governance and risk management frameworks.
However, Kenyans still remain in limbo over the Cyber Crimes Bill after the High Court temporarily suspended 22 sections of the law when industry players criticized it for targeting content creators rather than looking out for citizens’ digital well-being.


Source: https://www.businessdailyafrica.com/corporate/tech/Regulator-warns-of-rise-in-cybersecurity-threats/4258474-4927994-c4k826z/index.html

 

SACCOs union achieves new ISO standard

Kenya Union of Savings and Credit Cooperative (KUSCCO) has received the new ISO 9001:2015 standard certification for complying with statutory requirements set by Kenya Bureau of Standards. Speaking during the ceremony in a Nairobi hotel, KUSCCO Managing Director George Ototo said the union had made history to conform to the new standards.
 “Today marks another milestone in the union’s history. This achievement was made possible through the hard work and leadership in the union and the coordination of the ISO team. Let us join hands in celebrating the union’s transition to the new ISO standards,” he said. Mr Ototo said the certification will drive the union to deliver quality products and services that meet customer needs as well as regulatory and statutory requirements. Appointed He said the union has gone global after its chairman George Magutu was recently appointed as a director of the International Cooperative Alliance. The MD was also re-appointed to the International Raiffeisen Union (IRU) board representing SACCOs in Kenya.  
“The new ISO certification has now given us a footprint to become a reliable business partner. It will help towards risk mitigation in terms of competition,” Ototo said. Mr Magutu said the re-certification was developed by ISO champions after the previous ISO 9001:2008 expired in 2017. “We will continue to champion our core mandate of advocacy and representation as we participate and make contributions towards formulation, conclusion and implementation of the proposed National Cooperative Development Policy and relevant Acts and regulations,” he added.
Kenya Bureau of Standards Quality Assurance Director Andrew Maho said 28 laboratories have been certified across the country that include meteorological services. Maho said they were working on proposed ISO certification for the secretariats.

https://www.standardmedia.co.ke/business/article/2001298939/saccos-union-achieves-new-iso-standard

 

ISO 9001

KUSCCO QUALITY POLICY

We commit to consistently promote SACCOs through advocacy and provision of quality technical and financial products that exceed the members’ expectations.
We shall comply with the statutory requirements and actively pursue continuous improvement of the ISO 9001:2015 Quality Management System (QMS) processes, capabilities and effectiveness.
In pursuit of our commitment we shall ensure that the quality policy and objectives that have been established and communicated to the Union employees shall be reviewed annually in accordance with the stipulated framework and quality standards.”