Financial Independence for Kenyans: Jonathan Asena’s Vision for Kimisitu Sacco

Could you provide a brief overview of your company, including its background and services?

My name is Jonathan Asena, the Marketing and Business Development Manager at Kimisitu Sacco. Kimisitu Sacco is a Savings and Credit Cooperative Society in Kenya, serving members in Kenya and abroad. We have been around for 39 years. “Kimisitu” is a Swahili name meaning “agriculture and forestry.” We originated from an international organization, now known as Wild Agroforestry, which influenced our name. In the early 1990s, most Saccos were using Swahili names, which is why we chose Kimisitu.

Over time, we have grown to 14,000 active members across 70 countries. Currently, we have an asset base of 11.8 billion Kenyan shillings. What sets us apart from other Saccos is our focus on digital services. We have invested heavily in technology to ensure that members, whether in Nairobi, outside Nairobi, or abroad, can access all services. We were recognized last year at the prestigious Chief Information Africa Awards as the most digitized Sacco in Africa.

Our primary services include savings and credit. Our loan multiplier is high; we offer loans up to four times the member’s savings. We also focus on housing and land acquisition to provide affordable housing options. Through partnerships with housing companies, we can advance members up to seven times their deposits at affordable rates of 12% per annum on a reducing balance.

Our value proposition lies in leveraging technology to serve members worldwide and ensure consistent service uptime with strong system security. We have not experienced issues with system security. Our goal is to transform the lives of our members by providing affordable credit. For employed members, we offer working capital to start businesses and improve their socioeconomic status. In the affordable housing sector, we help members achieve their housing goals, and for small business owners, we provide low-cost credit to support business growth.

In addition to funds, we emphasize financial literacy education, partnering with organizations to guide members on the basics of starting, running, and sustaining businesses. This has helped middle- and high-end business members achieve stability and growth. Additionally, our members’ employees benefit from various products offered by Kimisitu Sacco.

Could you briefly discuss your competitive advantage?

What makes us different is that there are many Saccos in Kenya, and we are all targeting a similar market. Most Saccos in Kenya have opened up their membership bond. Our competitive advantage is that we primarily serve the international and non-governmental organization sector. In this space, we find that the majority of employees are on very short-term contracts, ranging from six months to one, two, three, up to five years. Most financial institutions do not consider granting a mortgage or long-term loan beyond the term of a member’s contract. However, because we have been in this space for a long time, we can provide credit regardless of the contract type. This approach has worked well for us, and our portfolio at risk remains very healthy.

We have also invested significantly in technology. In the Sacco industry, loans are often guaranteed by deposits, and we have made it possible for members to manage this process online. We are moving towards a paperless environment through the adoption of an electronic digital management system. When members visit our office, they find we are nearly paperless. For those who prefer physical applications, we accept them, but they end at customer service, and the entire loan process, from filing to disbursement, is handled electronically.

Who is eligible to join Kimisitu, and what are the main benefits of membership?

Everyone is eligible to become a member of Kimisitu Sacco. We serve Kenyans living and working both in Kenya and abroad; currently, we have members in 70 countries. Essentially, anyone seeking financial independence can join Kimisitu Sacco. This aligns with our new vision and strategic plan for 2024–2028.

The benefits for our members start with a safe investment vehicle where they can securely invest their money. We have been tried and tested for 39 years and maintain strong financial health as we are regulated by the Sacco Societies Regulatory Authority. Members can access loans at very affordable rates—12% per annum on a reducing balance—and we offer extended terms; for example, our housing facilities have repayment periods of up to 15 years.

Beyond loan facilities, we support economic growth across industries like agriculture, manufacturing, and various business types. We also have members who join simply to save and earn from share capital and interest on deposits. For over five years, we have consistently provided an average dividend of 15% per annum, which is highly competitive even when compared to government securities. Our strategic plan aims to maintain a minimum 10% return on deposits, which we see as a key value proposition.

Finally, we offer financial literacy programs for our members. Saving and borrowing are essential, but knowing where to invest is just as important. We support our members’ financial knowledge by exposing them to business fairs, exchanges, and partnerships with industries in Kenya. This helps members understand what is required in various fields, ensuring they are not just receiving funds but are equipped to make informed decisions on how to maximize their investments.

What digital projects is your organization currently working on?

Saccos in Kenya are allowed to mobilize deposits from members and lend back to them at affordable rates. Our services primarily revolve around savings and credit products. Any services outside of this require approval from our regulator. For instance, we cannot invest in properties because we are trading with members’ money.

We focus on savings and loan products, which we develop by engaging members through various forums and surveys to understand their needs. While we also make controlled investments, such as fixed deposits with banks, money markets, and government bonds, these represent a small portion of our income.

Our main goal is to grow the Sacco’s income to meet operational expenses while paying competitive dividend rates and interest on deposits. We ensure our liquidity remains sound, so when a member applies for a facility, they can receive their loan without delays. This is a problem we have never faced.

Where do you envision your organization in the next three years, particularly regarding growth and your digital vision?

In the next two years, we aim to grow our membership to over 42,000 and expand into various sectors, particularly the business community. We opened our common bond four years ago and are focused on establishing more branch networks and partnerships with agents both locally and internationally.

As part of this growth, we plan to increase our assets and the number of loans we issue. Kimisitu Sacco is ISO 9001:2015 certified, and we are dedicated to providing our members with the best services through robust systems and processes. Member satisfaction is a core value, as we strive for a happy community.

Additionally, we recently launched the Kimisitu Foundation, which focuses on environmental and social governance initiatives. This foundation will support community projects aimed at creating green spaces and preserving our environment. One specific initiative is the “Green Run,” which will mobilize the community to enhance our surroundings while continuing to provide financial services.

Regarding international growth, you mentioned serving members in 70 countries. Is this part of a planned strategy for expansion abroad, or has it developed organically?

This is part of our strategy, specifically focusing on diaspora membership, as we are only allowed to serve Kenyans. Our goal is for every Kenyan living outside the country to view Kimisitu as their preferred option for investing their money.

Many diaspora members send remittances back to Kenya and are interested in investment opportunities here. We aim to become the cooperative that provides a safe solution for these members, as many do not trust their relatives back home to manage their funds properly.

We are developing mechanisms that will simplify the process for diaspora members to invest securely in Kenya. From our interactions, we understand that they are primarily interested in income-generating projects, including agriculture and real estate. Addressing this need is a key part of our strategic plan for further growth.

Is there anything else you would like to add?

Through the questions, we have captured the majority of the key points. I am not sure if you have interviewed another Sacco before, but the operations of a Sacco differ from those of a conventional bank due to the nature of membership. In a Sacco, members are shareholders, meaning they have a say in decisions; it is one member, one vote. Members have the opportunity to grow their share capital, although there are regulations governing the maximum share capital each member can hold. Currently, the law does not permit any single contributor to exceed 20% of the total Sacco shareholding.

Lastly, Kimisitu has undergone significant transformation. We initially started in international organizations, and we have since expanded our bond to serve all Kenyans, including those working outside the country.

Can you explain more about the common bond you opened? What is it, and why do people subscribe to it?

Our common bond initially included international organizations, non-governmental organizations, and embassies. By opening up the bond, we have expanded our membership to the general public. This means that individuals, businesses from any sector, and registered entities, such as limited liability companies and partnerships, can now join. Our open bond signifies that we are now accessible to a broader range of members, allowing us to trade with everyone.

FAIR USE POLICY
This material (including media content) may not be published, broadcasted, rewritten, or redistributed. However, linking directly to the page (including the source, i.e. Marcopolis.net) is permitted and encouraged.