Exploring growth opportunities for Saccos in Kenya & the region

The East Africa's Savings and Credit Cooperatives society, Sacco financial bloc meeting recently concluded in Kigali, Rwanda with the aim of enhancing collaborations and investments across the region. The meeting brought together representatives from Tanzania, Kenya, Uganda, and other countries in the region. CNBC Africa had the privilege of interviewing David Mategwa, the Board Chairman of Kenya National Police DT Sacco, to delve into the growth opportunities for Saccos in Kenya and the region. During the interview, Mategwa emphasized the importance of digitalization in ensuring the survival and relevance of Saccos in the current landscape. He highlighted that Saccos need to invest in robust technology systems to attract the younger population in Africa, which has an average age of 19. Mategwa stressed that digitalizing services is essential to catering to the preferences of the youth who seek seamless and convenient processes. The conversation steered towards product diversification, with Mategwa noting the significance of Saccos capitalizing their organizations to offer a wide array of financial products, including mortgages. He underlined the necessity of Saccos being well-capitalized to meet the evolving needs of their members and to remain competitive in the market. Furthermore, Mategwa discussed the pivotal role of digital transformation in enhancing member experiences and improving operational efficiency. He emphasized the need for Saccos to collaborate, especially in the case of smaller Saccos that may struggle to afford costly technology investments. Mategwa advocated for mergers and acquisitions as a means to achieve economies of scale and ensure that Saccos stay ahead in the rapidly changing financial landscape. The interview also touched upon opportunities for regional collaboration among Saccos in East Africa. Mategwa highlighted the importance of sharing best practices and learning from successful cooperative models in other regions such as the United States. He underscored the potential for Saccos in East Africa to enhance their operations and economic impact by adopting proven strategies from more established cooperative movements. Moreover, Mategwa shed light on the regulatory frameworks governing Saccos in the region. He emphasized the positive impact of regulations in fostering member confidence, asset growth, and overall stability within the cooperative sector. Mategwa cited the success story of Kenya, where the introduction of regulatory measures by the Circle of Regulations Authority in 2010 led to significant growth in Saccos' assets and membership, instilling trust among investors. In conclusion, the discussion with David Mategwa brought to the forefront the imperative need for Saccos in Kenya and East Africa to embrace technological advancements, diversify their product offerings, and collaborate regionally to drive sustainable growth and foster financial inclusion. By leveraging innovation and adopting best practices, Saccos can position themselves as key players in the economic development of the region.