Cooperatives Cabinet Secretary Simon Chelugui has renewed calls on Saccos to come up with a central liquidity system that will facilitate them to clear cheques and borrow from each other.

Chelugui says Saccos will significantly reduce their financing costs if they joined the National Payments System.

The central liquidity system backed to help Saccos reduce reliance on banks for financing, cheque processing and electronic cash transfer.

Saccos have also been challenged to diversify their products to attract membership.

Chelugui says the government plans to disburse through Saccos and banks, the second phase of the Hustler Fund that will see MSMEs and registered groups accessing loans of between Ksh 100,000 and Ksh 2.5 million.

He says in future, borrowers will be assessed based on their credit score systems, which will then advance to a saving score system.

Since its launch in November last year, over 18 million Kenyans have borrowed Ksh 16 billion from the Hustler Fund and repaid half of the borrowed amount.

Eight million Kenyans repaid the Hustler Fund loans within the stipulated 14 days while four million borrowers settled in a month.

Chelugui was speaking during Cooperative Bank’s inaugural two-day Cooperative CEOs forum roundtable to focus on how the cooperative movement can step up support to Micro, Small and Medium sized Enterprises (MSME).

By Fred Azelwa.