SACCOS (Savings and Credit Co-Operative Society) are democratic, member driven organizations which provide loan and saving products to their members. The ownership of the organization is based on the number of shares a member own to the SACCOS.
In Tanzania, SACCOS are regulated by Tanzania Cooperatives Development Commission (TCDC), under the Cooperative Societies Act, 2013. Its governance is guided by having a board which is led by board chairman selected from members and other members of the board also selected from the members of the SACCOS
The SACCOS emerged out of the credit system of the old cooperatives. They began as ROSCAs in 1920 and they were common in cash crop producing areas, aim was to improve farmers’ access to market. For some times Tanzania relied to foreign NGOs such as FINCA and PRIDE to give credits to the people.
According to SACCOS annual report of the year 2022, produced by Tanzania Cooperative Development Commission (TCDC);
i) There were 2,034 registered SACCOS where 759 of them were licensed.
ii) There were 1.8 million members which is an increase of 38% from 2021.
ii) The total assets were 1.22 trillion which is an increase of 37% from 2021
iv) The total savings and deposits were TZS 897 billions
v) The total loan outstanding was TZS 1.05 trillion and
vi) Made investment of TZS 94.2 billion which is an increase of 18.3% from 2021
The above data are based only on licensed SACCOS. The data implies that SACCOS has been growing. Growing in the number of members and hence the assets and the deposits made. Issued more loan to finance education, business, agriculture activities and other developments of its members. Increased in the investment made and hence created more jobs and work opportunities in the society and hence contributed to economic growth in the country.
SACCOS are operating with challenges that hinder the speed of their growth. According to the TCDC’s 2022 annual report on SACCOS . Among the challenges affecting the license applications of SACCOS are:
- Not enough capital as the regulation requires
- Not having internal auditors
- Lack of management information system (MIS).
- Reporting & data management challenges
- Delayed service delivery to members
Also it has been reported that only 208 SACCOS were using ICT systems as of 2022 which shows that large number of SACCOS are still not digitalized making it difficult to improve their products and services.
Core Banking systems like Amala : Digitalizing Microfinance and SACCOS partners with SACCOS to improve the livelihood of people by automating SACCOS operations, improve service delivery, focusing on improving the livelihoods of its members with Features like:
- Loan, saving and shares management
- Asset Management
- Bank reconciliation
- Automatic dividend calculation and posting
- Mobile banking Applications allows members of SACCOS to apply for loan, access their information and make repayments
- SMS/Email automatic notification
- Mobile money Payment’s integrations
Reach out through huduma@amala.co.tz or call us at 0766 521258 and let us support you to provide best financial services your members deserve.
