Coffee management committees have been warned against accumulating debts after the Sh6.8 billion coffee debt waiver is disbursed. President William Ruto warned the coffee managements to avoid plunging their societies into more debts
Speaking in Meru when accompanied by his deputy Rigathi Gachagua, Ruto said the management should desist from acquiring expensive loans charged at an interest of 29 percent. ” Stop taking loans charged at high rates and acquire it from the government at the rate of 3.6 percent,” said the president.
At the same time, he also barred boards of management of coffee to manage the loans, he directed that credit will be authorised during the Annual General Meeting where the farmers are represented. At the meetings, Ruto stated that the farmers need to be informed on the loan being taken with justifications given for the loan.
“Going forward, no debt will be taken by the management or by the board until it is approved at the general meeting so that farmers can know how much is being taken and what is going to be used for,” he stated. This week the cabinet directed the cooperatives to submit details of their loans to the Ministry of Cooperatives within seven days to benefit from the waiver programme.
In the waiver request of Sh 8,2 billion, Murang’a farmers seek the highest amount at a tune of Sh1.7 billion followed by New KPCU at Sh1.4 billion. Nyeri farmers seek a waiver of Sh930,407,607, Kiambu Sh147,824,451, Kirinyaga Sh979,239,904 and Embu Sh667,267,248.
Machakos Sh360.4 million, Kisii Sh711 Million, Tharaka Nithi Sh 373 million. In the analysis, The County Times established that the cooperative in the counties had loans in Cooperative Bank, Equity, KCB, Family Bank.
The entities also had debt with coffee millers, namely Tropical Farm Management, SMS, CMS, Bungoma Mills, Sasini, ThiKA Coffee Mills, Thima, NKG and Kahawa Bora. Also, they had loans with cooperative unions and salaries arrears for their workers and non-remittance of statutory deductions.