Anchor Sacco grapples with Sh300 million debt

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Sacco

A Thika-based savings and credit cooperative society is grappling with Sh300 million debt owed by a housing cooperative and other unpaid loans from members as it seeks to regain its footing.

Anchor Sacco that has been grappling with the bad debts says its aggressively pursuing the debt and loans so as to continue to deliver to its members.

Sacco Chairman Joseph Mbai said deliberations between the management board and the former sister society, Urithi Housing Cooperative (UHCL) to get the funds and discuss deliverables are ongoing.

Speaking during the Sacco’s AGM in Thika, Mbai said despite the challenges, the Sacco has over the last year made strides in profitability, increase in new membership and resettling members to new plots.

During the year ended December 2023, membership grew to 10,023 after 110 more joined the sacco. Dormant accounts are also being re-activated, driving membership deposits by more than Sh4 million in the past 12 months. Paul Thuku, the Sacco’s treasurer said net profit jumped by 54 percent to Sh3.2 million.

To increase revenue streams, he said the sacco has opened a new company, Anchor Premier Venture, as a vehicle for members to acquire land.  Additionally, he said, the sacco has opened an insurance agency to advice and help in insurance of the Sacco’s assets.

He added that the Sacco is struggling to issue new loans due to poor repayment rate by members. “Last year, the Sacco advanced loans amounting to Sh43.6 million but the repayment rate is low. Loans are financed from collections only. We will soon seek permission from members to borrow some amounts to assist in clearing the backlog of loans at our desk,” he said.

Other strides the Sacco has made over the last one year include payment of a long standing Sh488,000 tax dispute with the Kenya Revenue Authority and resettling members who had been affected by the previous unavailability of plots.

Thika west cooperative officer Catherine Mbuki urged members to pay their loans promptly to enable others to benefit from the same. “I urge members to pay up their loans in good time so that others can get the same for the prosperity of the Sacco,” she said.