SMEs urged to consider Saccos when seeking credit

**Cooperatives and Micro, Small and Medium Enterprises (MSMEs) Cabinet Secretary Wycliffe Oparanya has urged small and medium business owners to consider Saccos as alternative source of affordable credit to drive their expansion. **

Oparanya said savings and credit cooperative societies provide an important avenue for small-scale traders to save, access loans and build sustainable businesses, especially at a time when many entrepreneurs face challenges accessing affordable capital.

Speaking in Trans Nzoia County, Oparanya cautioned traders against relying on informal lenders who charge high interest rates, saying such borrowing undermines livelihoods and makes it difficult for entrepreneurs to sustain their businesses.

“When we visit traders and encourage them to join Saccos, many tell us they are in ‘chamas’ yet they carry very high risks. The treasurer can disappear with your money, or on days when business is slow, you are still required to contribute. It just makes life difficult,” he said.

He encouraged traders to join SACCOs and make regular savings, noting that even small contributions could accumulate into meaningful amount, that can later be used to access credit and invest.

“I want people to invest and join SACCOs to be able to take loans for their businesses. Come in large numbers and save even as little as possible. By the end of the month, the accumulated amount will be of help,” he stated.

Oparanya said technology has transformed the cooperative sector by enabling members to access SACCO services, monitor their savings and conduct transactions through digital platforms without visiting physical offices.

“Because of technology, you can use mobile banking regardless of where you are. Therefore, you must embrace technology as a business person,” he said.

The CS said the Government is implementing programmes aimed at expanding access to capital for small businesses and young entrepreneurs.

He said the Hustler Fund has so far disbursed more than Ksh 90 billion, with 28 million Kenyans registered, adding that about two million people access loans through the Fund daily.

He added that the Government is also using the NYOTA Fund to support young people, while encouraging them to join Saccos to develop a savings culture and improve access to credit.

He commended the Cooperative Bank and the Cooperative Insurance Company (CIC) for providing financial and insurance services to members of the cooperative movement, saying such interventions help small businesses overcome challenges associated with access to capital and high interest rates.

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