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Kenya SACCO (Credit Union) Sector Response to COVID-19

World Council’s Technology and Innovation for Financial Inclusion (TIFI) Project team provided the following report on how the credit union sector in Kenya, where CUs are called Savings and Credit Cooperative Societies (SACCOs), is conducting business during the COVID-19 pandemic.
With the confirmation of the first infection cases of COVID-19 in Kenya, safety measures have been recommended to prevent new infections and curb the spread of the virus. Stakeholders in the financial services sector took various steps during the week starting March 16, 2020 in accordance with presidential directives and a Ministry of Health advisory to limit the spread of the disease. SACCOs are keen to mitigate negative effects of the pandemic on their staff, membership and financial performance in a sub-sector where the 175 deposit taking SACCOs held KES 495 billion (USD 4.66 billion) in assets, KES 359 billion (USD 3.38 billion) in loans and had a membership of 4.97 million, as of December 2018. In this regard, the SACCO Societies Regulatory Authority (SASRA) and Kenya Union of Savings and Credit Cooperatives Ltd. (KUSCCO) have each provided a set of guidelines for their member SACCOs in mid-March.
•    Approval of audited financial statements: SACCOs are directed to submit their financial statements to SASRA for review, approval, signing and stamping through email. This measure will minimize travel for SACCO staff for the review of their financial statements. Additionally, communication with the authority should be through emails and not physical letters or in person.
•    Annual General Meetings (AGMs): AGMs have been suspended for 30 days through a circular issued by the Commissioner for Cooperatives.
•    Business meetings: SACCOs are encouraged to minimize (physical) board meetings to strictly critical ones.
•    Payment of interest rebate: SACCOs should make payments of interest on member deposits only after audited financial statements have been approved.
•    Congestion in offices and banking halls: SACCOs are encouraged to allow staff to work from home where possible, and to encourage members to use mobile money instead of cash.
•    Risk management and plans: SACCOs are advised to take precautionary measures against situations that would constrain liquidity or lead to poor loan performance.
•    Critical outsourced services: SACCOs are advised to engage providers of critical business services such as mobile money, agency services and MIS to understand how they would ensure continuity of services should the situation worsen.
•    Communication to members: SACCOs are encouraged to make necessary communications to members about any changes in business operations that may affect service delivery.

In addition to some of above measures, KUSCCO circulated communication to member-SACCOs to implement safety measures such as:
•    Promoting and practicing hygiene by providing hand washing facilities in the banking halls, regularly cleaning objects that are touched frequently, providing enough boxes of tissue paper, removing magazines and papers from the waiting areas and common rooms, and limiting all forms of employee gatherings.
•    Limiting physical meetings or business travel, including promoting home stay policies for employees.
•    Promoting safe food handling and limiting food sharing.
•    Promoting open and timely communication with employees and members
Internally, KUSCCO has also allowed most of its staff to work from home, except for a very few handling critical roles, such as managers.
TIFI pilot SACCOs in Kenya have adhered to most of the provided guidelines. Some have implemented their own specific measures as well.


Source : https://www.woccu.org/newsroom/covid19_resources?post_id=1811#1811



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