5.0 LOAN POLICY
All loans shall be granted in accordance with the Loaning Policy and procedures to ensure that members efficiently get their loans and to facilitate and improve loan recoveries to assist members. The loaning policy is subject to review by the AGM from time to time.
a) WANAANGA SACCO may grant loans to members in the register.
b) The repayment period, borrowing power, and rate of interest on loans shall be proposed by the board of management of the society and approved by the AGM.
c) No loan shall be granted to a member who has no ability to pay in accordance to the ACT and these by-laws.
d) All loans shall be applied for on prescribed forms.
e) The loan application shall be signed by the member and in each shall set forth the amount applied for, the repayment the security, if any and such other information as the credit/front committee or loans officer may require. All applications for loans and the report of the credit/front committee or loans officer thereof shall be filled as a permanent record of the society.
f) Loan applications shall be considered by the credit/front committee in the order in which the applications are made unless the loan is deemed by the committee to be an emergency loan.
g) The credit/front/board of management may summon or cause an applicant to be summoned to appear personally to be interviewed in respect of his/ her application for a loan, to determine the members’ ability to repay the loan.
h) The loan application form shall clearly state the amount of the loan, the rate of interest, the terms of repayment, and the security if any.
i) All loans shall be approved by the credit/front committee and ratified by the board of management
j) For members being considered for a loan, his shares, savings, deposits, and any security approved by the board of management may be taken into account.
k) The board of management may draw further regulations in respect to granting of loans provided such a regulation shall not come into force until approved by a general meeting.
l) No loan or credit facility shall be granted to a member where the loan or credit facility, in the aggregate, exceeds such a limit of the society’s core capital.
m) All loans granted must be subjected to an insurance fee as may be determined by the Board.
5.1 SECURITY FOR LOANS
- Unless the loan applied for and its interest is equal to or less than the member’s deposits, guarantors or other acceptable collaterals must secure it.
- The total amount of loan applied for must be fully guaranteed and secured through;
i) Guarantors: – who shall all be active members of Wana-Anga SACCO
ii) Collateral: -This shall be used as per the Collateral Policy
iii) Self-guarantee: If loan amount is within untied member’s deposits.
iv) Fixed Deposit: If a member has a fixed deposit facility with the SACCO.
- The total share deposits of the borrower and those of the guarantor(s) must be
equal to or more than the loan plus interest applied for.
- All guarantors must be members of Wana-Anga SACCO society and no member shall be allowed to guarantee more than his/her total share deposits.
- Unless allowed by the Credit Committee through appraisal, no member shall be allowed to guarantee more than twenty (20) loans at any given time.
- Total individual guarantee shall not exceed 10 times their deposit or as may be determined by the board from time to time.
- An insider member of Wana-Anga SACCO shall NOT act as a guarantor of any person with respect to a loan facility applied.
- The society shall maintain a record of all guarantors to every loan in each member’s personal file.
- The obligations of the guarantors shall cease upon clearance of the loan and interest or upon replacement of the guarantor.
5.2 REPAYMENT OF LOANS
- A borrower may, on any day on which the society is open for business, repay his loan in whole or in part before maturity.
- The board of management may in the most exceptional circumstances agree to the refinancing of a loan balance or any request for an extension of time in which to pay. Any extension so granted shall be treated as though it was a new loan and an extension agreement shall be executed.
- For any delinquent loan, the board of management shall attach the guarantee(s). The amount in default shall be recovered from the guarantor’s salary, deposits, savings, terminal savings, terminal benefits, and any other securities.
- If the employer will not have remitted the deductions within the first 7 days of every month the board of management shall refer the matter to the commissioner.
Any loan more than four months overdue may be referred to the Co-operative Tribunal as a dispute.
5.3 LOAN DEFAULTING
A member shall be considered a loan defaulter if his/her regular repayment has ceased.
- The society at its discretion shall forward details of the defaulter to debt collectors, credit reference bureau or pursue recovery through small claims court among other options.
- The society shall inform the defaulter in writing with a copy to the parties involved.
- The society shall attach the salary, terminal benefits and any other security for the loanee and the guarantor where applicable and necessary.
- Any member or an employee of the society who tampers with his/her monthly shares contribution and loan repayments is liable to a disciplinary action to be determined by the Board.
- In case of any default in payment, the entire loan balance will immediately become due and payable at the discretion of the society.
- All shares and deposits owned by the member plus any interest and deposits due to the member will be set against the owed amount.
- The member will be liable for any costs incurred in the collection of the loan balance and accumulated interest. Any remaining balance will be deducted from guarantors or terminal benefits where applicable.
6WANA-ANGA SACCO SOCIETY BACK OFFICE LOAN POLICY
You can Download the Loan application form here
1.0 INTRODUCTION
The loan policy for Savings and Credit Co-operative Societies (commonly referred to as SACCO societies) was last reviewed in 1992 under the Commissioner’s circular letter No. MCD/ORG/7/VOL11/55 of 6th August 1992. Since then, a lot of development (i.e. liberalization has taken place within the SACCO societies thereby necessitating the revision of the policy guidelines.
The revised loan policy as a whole is designed to conform with and supplement the By-laws of Wana-Anga SACCO society with a view to:-
a) Ensure that Wana-Anga gives loan in an efficient manner.
b) Facilitate loan processing and improve loan recoveries so as to achieve wana-anga objectives.
1.1 TYPES OF LOANS
BACK-OFFICE SERVICE ACTIVITIES (BOSA)
i) Normal/Development Loans
ii) Super Normal Loan
iii) Deposit Boosting Loan
iv) Dividend loan
v) Emergency Loan
vi) School fees Loan
a) Normal/development loans
This loan enables members to finance personal development projects.
b) Super Normal Loan
This loan enables members to acquire assets & finance other development projects.
c) Deposits Boosting Loan
This loan will be granted to members who wish to boost their deposits.
d) Dividends In Advance
This loan granted to member who wish to take a portion of their dividend or interest on deposits within two months before payment.
e) Emergency Loans
Emergencies include unexpected hospitalization, and unforeseen circumstances beyond a member’s control.
f) School Fee Loan
This is a loan granted to a member to pay for primary and secondary school fees only.
2.0 Front Office Service Activities (FOSA).
All members of the Wana-Anga SACCO LTD will be required to have FOSA Account through which all loans and refunds will be processed.
2.1 FOSA Products.
The following products are available in FOSA
1) Front Office Loan
2) College Fee Loan
Caters for college and university fees.
3) Silver Loan
This is a loan that is granted to members with the following requirements.
3) Karibu Loan
This loan may be granted to new check off member to boost his/her shares/deposits only. To qualify for this loan, you need to have 3 months of active membership.
The loan has the following features:
4) Rudi Nyumbani.
This loan is granted to members to clear outstanding loans with other financial institutions.
5) WANA-PAP.
This mobile loan facility allows members to access affordable instant mobile loans through our USSD and Mobile App to meet their personal and emergency needs.
2.0 LOAN ELIGIBILITY
A member of Wana-Anga SACCO Society may be eligible for a loan only if the member:-
i. A 1/3 rule shall apply as per the labor regulation.
ii. Provide two most current pay slips certified by the employer.
iii. Security (Guarantors and Collateral).
i. Provide two months’ bank statement certified by the bank.
ii. Provide certified copy of the National Identity card.
iii. Security (Guarantors and Collateral).
3.0 LOAN APPLICATION
i. The amount applied for.
ii. The purpose of the loan.
iii. Terms of repayment.
iv. Type of security provided.
v. Guarantors, loans, deposits, ID number, phone numbers and email.
vi. Preferred disbursement method.
i. For check-off Member: Attach two (2) payslips for the current month and a preceding month, supporting documents (copy of the ID, PIN certificate) and loan security (Guarantors, Collateral or both).
ii. For non-check off member: Provide proof of regular income (6 months’ bank statement or3 months M-Pesa statement), Bank standing order, Copy of the National identity card (Both front and back) or a passport, loan security (Guarantor, Collateral or both).
3.1 COMMISSION AND LOAN CHARGES
Each loan that is processed will attract the following initial charges:
4.0 LOAN APPROVAL
5.0 LOAN POLICY
All loans shall be granted in accordance with the Loaning Policy and procedures to ensure that members efficiently get their loans and to facilitate and improve loan recoveries to assist members. The loaning policy is subject to review by the AGM from time to time.
a) WANAANGA SACCO may grant loans to members in the register.
b) The repayment period, borrowing power, and rate of interest on loans shall be proposed by the board of management of the society and approved by the AGM.
c) No loan shall be granted to a member who has no ability to pay in accordance to the ACT and these by-laws.
d) All loans shall be applied for on prescribed forms.
e) The loan application shall be signed by the member and in each shall set forth the amount applied for, the repayment the security, if any and such other information as the credit/front committee or loans officer may require. All applications for loans and the report of the credit/front committee or loans officer thereof shall be filled as a permanent record of the society.
f) Loan applications shall be considered by the credit/front committee in the order in which the applications are made unless the loan is deemed by the committee to be an emergency loan.
g) The credit/front/board of management may summon or cause an applicant to be summoned to appear personally to be interviewed in respect of his/ her application for a loan, to determine the members’ ability to repay the loan.
h) The loan application form shall clearly state the amount of the loan, the rate of interest, the terms of repayment, and the security if any.
i) All loans shall be approved by the credit/front committee and ratified by the board of management
j) For members being considered for a loan, his shares, savings, deposits, and any security approved by the board of management may be taken into account.
k) The board of management may draw further regulations in respect to granting of loans provided such a regulation shall not come into force until approved by a general meeting.
l) No loan or credit facility shall be granted to a member where the loan or credit facility, in the aggregate, exceeds such a limit of the society’s core capital.
m) All loans granted must be subjected to an insurance fee as may be determined by the Board.
5.1 SECURITY FOR LOANS
i) Guarantors: – who shall all be active members of Wana-Anga SACCO
ii) Collateral: -This shall be used as per the Collateral Policy
iii) Self-guarantee: If loan amount is within untied member’s deposits.
iv) Fixed Deposit: If a member has a fixed deposit facility with the SACCO.
equal to or more than the loan plus interest applied for.
5.2 REPAYMENT OF LOANS
Any loan more than four months overdue may be referred to the Co-operative Tribunal as a dispute.
5.3 LOAN DEFAULTING
A member shall be considered a loan defaulter if his/her regular repayment has ceased.