Metropolitan Sacco has recorded Ksh9.3 billion on bad loans or non-performing loans, denying its members dividends for the year ended December 2021.
As a result, the sacco has set aside Ksh6.7 billion as insurance against bad loans, which are threatening to collapse the sacco.
“On a more positive note, providing for these loans will give the Sacco full use of the measures available in the law to recover these loans from the defaulting members and their guarantors,” said the outgoing chairperson Mr Christopher Karanja.
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In a bid to save the sinking boat, the sacco has decided to go after serial defaulters, cut costs, and overhaul its governance structure to meet legal requirements and reflect the diversity of its membership.
Also revealed during the Sacco’s Annual General Meeting (AGM) in Nairobi last Saturday is that members with loans of up to Ksh2 million are contributing a monthly minimum of Ksh3,000. In new changes, such members would be required to contribute more.
In other changes, board members who retire from active service automatically retire from the board. The chairperson, vice-chairperson, treasurer and secretary-general are also to serve for only two terms of three years each.
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“The benefit of this system is that members will be able to elect local representatives who will air their issues to the board and ensure a more responsive governance of the Sacco,” said the chairman.
Sacco’s share capital has been raised from Ksh10,000 to Ksh20,000.
With over 100,000 members, Metropolitan Sacco draws its membership from the Teachers Service Commission, ministries, parastatals, Kenya Defence Forces, National Police Service, public and private universities, colleges, academies and the private sector.
It is the sixth-largest Sacco in the country with an asset base of Sh14.8 billion.
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