Kenyan Saccos Thrive Amid Economic Challenges: Delivering High Dividends and Benefits to Members
Written by moradio on 29 February 2024
NAIROBI, Kenya, February 29 -Savings and Credit Co-operative Societies (Saccos) are delivering substantial benefits to members through increased dividends and rebates, with some reaching up to 20 percent.
This uptick follows a period of resilience post-Covid-19, as evidenced by a four percent rise in returns on 2023 savings compared to the previous year.
Improved surpluses, a surge in membership, and higher member deposits are key factors driving this positive trend.
Leading Saccos such as Kenya National Police DT Sacco and Harambee Sacco are setting new records in dividend payouts.
For instance, Kenya National Police DT Sacco, ranked third in asset base, proposed a dividend payout of 17 percent on share capital, totaling Sh552 million, reflecting an increase from the previous year’s payout of 11 percent, amounting to Sh2.7 billion.
Similarly, Harambee Sacco, the fourth-largest player in the market, declared a record-high dividend of 12 percent on members’ deposits.
Despite economic challenges, including inflation and global conflicts, Saccos like Nation Sacco are still achieving remarkable results. Nation Sacco announced a substantial dividend payout of 20 percent per share and 11 percent on members’ deposits.
Yetu Sacco also saw significant growth, with members benefiting from attractive dividends and interest rates. CEO Dennis Kirimi reported a 28 percent increase in membership from 66,084 in 2022 to 84,075 in 2023.
Safaricom Investment Cooperative (SIC) members are expected to receive dividends totaling Sh142.4 million, despite a decrease in profits. Nonetheless, the cooperative’s net profit still yields an 8.1 percent return on members’ capital of Sh2.5 billion.
The land business continues to be the primary revenue driver for Saccos, contributing 90 percent of total revenue and generating a gross revenue of Sh1.4 billion.
The Sacco sector in Kenya is experiencing significant growth, surpassing a trillion in assets in 2023. Data from the State Department of Cooperatives indicates a 15.6 percent increase in savings to Sh1.047 trillion in the year leading up to June 2023 from Sh906 billion, marking a substantial milestone for Kenya’s cooperative movement.
