POLICE SACCO OFFERS THE MOST EXPENSIVE LOANS TO MEMBERS

The State Department of Co-operatives has called in the Ethics and Anti-Corruption Commission (EACC) to help in investigating and prosecuting fraudulent officials to protect the savings of an estimated 14 million Kenyans who are Sacco members.

Traffic police cop David Mategwa is currently the Kenya Police Sacco as chairman

Kenya Police Sacco has been accused of offering the most expensive loans by a section of its own members as compared to other Saccos like Mwalimu and Harambee Sacco. The Sacco under the leadership of current Chairman David Mategwa and CEO Solomon Atsiaya is performing poorly compared to other Sacco’s. Commissioner of Co-operatives, Mary Mungai, recently told the media that weak governance and outright fraud were the biggest challenge facing the co-operative movement.

The State Department of Co-operatives has called in the Ethics and Anti-Corruption Commission (EACC) to help in investigating and prosecuting fraudulent officials to protect the savings of an estimated 14 million Kenyans who are Sacco members.

 

         CEO Solomon Atsiaya

 The three Saccos; Mwalimu, Ekeza and Stima Investment Co-operative, are together estimated to have lost their members upwards of Sh3.6 billion through mismanagement or outright fraud by officials and boards. It is now feared that Kenya Police Sacco may become a victim of the mass exodus by members if the current regime is not replaced soon.

 Research conducted by The Weekly Vision team suggests that the 63,000 members of Sacco pay a whopping 48 percent annual interest on some loans.Kenya Police Sacco whose membership is drawn mainly from the police force, charges interest of 4 percent per month (48 percent annually) on Golden Fosa loans.

It also charges interest of 3 percent per month (36 percent annually) on Fosa advance loans. Harambee Sacco, on the other hand, charges only 14 percent annually on salary advance.On school fees loans, Kenya Police Sacco charges 13.5 percent reducing balance while Harambee Sacco charges only 1 percent reducing balance.Mwalimu Sacco, with over 60,000 members, also charges only 1 percent on reducing balance on school fees loans.

Mwalimu Sacco also charges a high 5 percent per month (60 percent annually) on salary advance.

On Mega loans (development), Kenya Police Sacco charges 15 percent on reducing balance while Harambee Sacco only charges 1 percent reducing balance on development loans.

When it comes to emergency loans, Kenya Police Sacco is still the most expensive with interest rate of 13.5 percent on reducing balance.

Harambee Sacco and Mwalimu Sacco charge only 1 percent reducing balance on emergency loans.

When it comes to Benevolence Cover (Sink Fund), Kenya Police Sacco members contribute Shs 350 per month but pays only Shs 70,000 if the member dies. It also pays Shs 40,000 in case of death of spouse an Shs 30,000 for child. They do not pay for parents.

On the other hand, Harambee Sacco memebrs contribute only Shs 300 monthly but pays out Shs 150,000 if the member passes on. It also pays Shs 100,000 for spouse or child. Further, Harambee Sacco pays Shs 50,000 if a parent to the member dies.

Mwalimu Sacco members contribute Shs 450 per month. The Sacco pays Shs 80,000 in case of death of member, Shs 50,000 for spouse and Shs 25,000 for child.