Poor monitoring skills largely contribute to absence of loan use data within Saccos, according to a report by the regulator. The problem is made worse where Saccos have no loan usage monitoring policy with 28 per cent responses indicating this as a challenge. According to the report, the traditional member-based nature of Saccos was built around financing of members’ social needs. The Saccos usually grew from strong social foundations, where members were accountable to each other within the closed bonds. This, has however, changed as Saccos expand, providing market driven micro-credit products to a bigger and more diversified member base.

Source: The Star February 21, 2019 20:15 UTC