In Kenya, Savings and Credit Cooperatives (Saccos) play a vital role in empowering individuals economically. Associated with savings, dividends, and loans, Saccos have become a cornerstone of financial stability for many households.
Shares in a Sacco represent a member’s ownership stake in the cooperative. Here’s a simplified breakdown of how to buy shares in a Sacco:
- Membership Sign-Up: To become a shareholder, you must first become a member of the Sacco. This involves filling out a membership application form with personal details such as your full name, date of birth, and ID number. You’ll also need to pay a one-time membership fee, which varies depending on the Sacco, ranging from Ksh.500 to Kshs.10,000. Additionally, you’ll be required to make a monthly minimum contribution.
- Obtain a Unique Membership Number: Once your membership application is approved, you’ll receive a unique membership number. This number serves as your identity within the Sacco and simplifies record-keeping for transactions and filings.
- Purchase Sacco Shares: After becoming a member, you can buy shares in the Sacco to gain full membership privileges. The share capital required varies among Saccos, with some having a minimum share capital of Sh 5,000 and others requiring over Sh 50,000. It’s essential to inquire about the exact amount before joining a specific Sacco.
Why Buy Shares in a Sacco?
- Access to Loans: Your savings and shares in the Sacco serve as the basis for borrowing. By investing in shares, you increase your borrowing capacity and access to funds for personal development and investment.
- Dividends: Shareholders receive annual dividends based on their savings and shares. These dividends represent the interest earned on your investment, providing an additional source of income.
- Co-Ownership: Owning shares in a Sacco grants you co-ownership rights, allowing you to participate in decision-making processes and shaping the future of the cooperative.
In conclusion, joining a Sacco and purchasing shares is a strategic financial move for Kenyan investors. With over 200 registered Saccos in Kenya, individuals have a wide range of options to choose from. However, it’s crucial to select a reputable, licensed, and financially stable Sacco that aligns with your financial goals and investment preferences.
